IF""— 


HISTORY  AND  PROCEEDINGS 
OF  THE 

WORLD'S 
INSURANCE   CONGRESS 


HISTORY  AND  PROCEEDINGS 

OF  THE 

WORLD'S 
INSURANCE   CONGRESS 

SAN  FRANCISCO,  CAL. 
1915 


UNDER  THE  AUSPICES  OF  THE 

PANAMA-PACIFIC  INTERNATIONAL 
EXPOSITION 

W.  L.  HATHAWAY,  COMMISSIONER 


WITH  A  REVIEW  OF   PRELIMINARY   EVENTS 
FROM    I9IO   TO    I915 

EDITED    BY 

F.  ROBERTSON  JONES,  A.M.,  Ph.D. 


PUBLISHED  BY  THE  CENTRAL  COMMITTEE 
OF    THE    NATIONAL  INSURANCE    COUNCIL 


Copyright,  1917,  by 
F.  ROBERTSON  JONES 


.GIFT 


To 

W.  L.  HATHAWAY 


M'^siiaG 


PREFACE 

This  volume,  embodying  the  "History  and  Proceedings  of  the 
World's  Insurance  Congress"  (San  Francisco,  California,  1915), 
has  been  edited  and  published  under  trying  circumstances.  In  the 
first  place,  a  final  decision  to  publish  the  book  could  not  be  reached 
until  a  sufficient  number  of  pre-paid  subscriptions  had  been 
received  to  cover  at  least  the  bare  cost  of  publication  and  other 
incidental  expenses.  In  the  second  place,  the  editor  has  been  able 
to  devote  to  his  task  only  spare  moments  outside  business  hours; 
and  these  spare  moments  have  been  hard  to  secure.  In  the  third 
place,  the  actual  printing  has  been  done  at  a  time  when  the  pub- 
lishers were  not  only  in  the  midst  of  the  busiest  part  of  their  year 
but  likewise  were  handicapped  by  a  shortage  of  help  due  to  the 
''draft"  and  to  other  labor  difficulties. 

The  fact,  however,  that  this  volume  is  published  over  two  years 
after  the  events  recorded  therein  happened  (regrettable  as  that 
fact  may  be),  does  not  in  the  least  degree  detract  from  its  value  as 
a  repository  of  living  documents  of  inestimable  concern  not  only 
to  all  branches  of  the  insurance  business  but  likewise  to  the  gen- 
eral public ;  for  of  that  general  public,  who  is  there  who  is  not 
interested  directly  or  indirectly  in  some  kind  of  insurance?  The 
volume  is,  in  fact,  practically  a  text-book  upon  the  subject  of 
insurance  and  should  be  in  the  library  of  not  only  every  insur- 
ance business  concern  and  every  insurance  worker,  but  also  every 
society  and  every  educational  institution. 

The  accuracy  of  this  statement,  I  believe,  will  be  confirmed  by 
a  perusal  of  the  volume  itself  or  even  by  an  examination  of  its 
index  and  contents ;  but  it  may  not  be  altogether  out  of  place 
(even  in  a  Preface)  to  fortify  the  statement  by  quoting  at  consid- 
erable length  from  the  remarkably  strong  and  lucid  report  of  a 
gentleman  who  had  peculiarly  good  opportunities  for  estimating 
accurately  at  first  hand  the  general  importance  of  the  events  and 
proceedings  recorded.  I  refer  to  the  report  of  Mr.  Charles  "W. 
Scovel,  of  Pittsburgh,  Pa.,  rendered  to  the  Twenty-seventh  Annual 
Convention  (St.  Louis,  Mo.,  September  19-21,  1916)  of  the  Na- 
tional Association  of  Life  Underwriters,  as  delegate  and  National 
Council  member  of  that  Association  at  the  World's  Insurance 
Congress  (San  Francisco,  October  4-14,  1915)  held  under  the 
auspices  of  the  Panama-Pacific  International  Exposition.  It  reads 
in  part  as  follows: 

"Having  followed  the  development  of  the  whole  idea  and  7">lan  from 
its  first  suggestion  by  one  of  our  own  members,  William  L.  Hathaway, 


viii  PREFACE 

at  our  1910  Convention  in  Detroit;  having  attended  the  sessions  of  the 
Congress  and  of  the  Council  and  all  its  committees ;  and  having  carefully 
read  many  of  the  addresses  after  already  hearing  them,  I  deem  it  proper 
to  record  here  my  conviction  that  this  movement,  even  if  it  were  to  end 
with  due  publication  of  the  proceedings  to  date,  cannot  fail  to  exert  a 
profound  and  lasting  influence;  and  that,  if  wisely  followed  up  by  its 
permanent  National  Insurance  Council,  it  will  prove  to  be  truly  epoch- 
making  in  the  histoi-y  of  the  vast  public  and  private  interests  linked 
together  by  the  name  insurance. 

"Three  main  grounds  support  this  conviction: 

"First,  the  unique  recognition  given  to  insurance  in  the  eyes  of  the 
world.  This  recognition  was  in  the  highest  degree  official — by  express 
action  of  the  State  Commission,  the  National  Commission  and  the  Inter- 
national Exposition,  itself  officially  recognized  by  nearly  all  foreign 
governments. 

"The  recognition  was  unique  in  this,  above  all  else,  that  it  singled  out 
insurance  from  other  lines  of  business  and  classified  it  under  the  head 
of  Social  Economy.  This  classification  was  adopted  after  much  discus- 
sion by  these  three  official  bodies,  to  which  that  judicial  function  was 
accorded  by  all  the  governments.  It  is  authoritative  beyond  appeal. 
It  has  profound  and  lasting  significance. 

"The  recognition,  furthermore,  was  active,  continuous  and  on  a  vast 
scale  of  publicity.  A  full  eommissionership  of  insurance  was  created, 
Mr.  Hathaway  being  the  logical  and  efficient  incumbent  and  thoroughly 
equipped  to  handle  a  world-wide  correspondence  through  scores  of  thou- 
sands of  letters  and  bulletins.  Thus  was  brought  together  an  unpar- 
alleled series  of  insurance  events,  beginning  in  April,  1914,  with  the 
public  dedication  of  the  first  and  largest  of  the  Exposition  buildings; 
resumed  a  year  later  in  the  'Nine  Years  After'  celebration  of  how  insur- 
ance had  rebuilt  the  city;  continued  through  innumerable  conventions 
of  insurance  interests,  including  that  of  our  own  Association;  and  cul- 
minating in  the  World's  Insurance  Congi-ess  itself,  called  together  offi- 
cially in  the  name  of  the  nation  by  the  Exposition,  through  its  com- 
missioner, and  with  the  cooperation  of  over  one  hundred  organizations 
representing  all  branches  of  insurance  and  related  activities,  all  parts 
of  the  country  and  thirteen  foreign  nations,  despite  the  world  war.  No 
recognition  remotely  approaching  this  has  ever  been  accorded  to  insur- 
ance before. 

"Second,  the  meeting  of  minds  and  men;  the  symposium  of  ideas. 
Fifty  addresses  were  prepared  by  picked  men  for  the  first  week's  regular 
sessions,  and  half  as  many  more  for  the  second  week's  open-air  events. 
Rarely,  if  ever,  has  any  one  branch  of  insurance  assembled  such  a  repre- 
sentation of  its  own  leading  minds  by  themselves;  and,  of  coui-se,  there 
has  never  been  anything  like  such  a  gathering  of  the  leading  minds  of 
all  branches  together.  Moreover,  these  minds  at  former  gatherings  have 
been  busied  with  the  internal  problems  of  their  own  branch,  or  at  most 
with  this  or  that  particular  outside  relation.  Here,  for  the  first  time, 
were  they  called  on  to  speak  from  a  real  world  platform;  to  view  the 
nature,  interests  and  services  of  their  own  branch  through  a  wide-angled 
lens,  taking  in  at  the  same  time  all  the  other  branches  of  insurance 
and  the  whole  broad  field  of  human  activity. 

"This  broader  vision  and  longer  perspective  were  noticeable  in  many 
of  the  addresses  when  separately  heard;  much  more  so  when  read  to- 
gether.    Familiar  truths  took  on  deeper  meanings.     General  relations, 


PREFACE  ix 

heretofore  vague  and  fanciful  when  thought  of  at  all,  began  to  seem 
clearer  and  more  practical.  The  reader  of  these  proceedings  will  find 
a  body  of  insurance  literature  remarkable  for  its  bird's-eye  sweep  over 
past  and  present  achievement  in  all  branches,  and  wholly  unprecedented 
in  its  suggestion  of  future  trends  and  possibilities.  If  ever  ideas  can 
thrive  and  spread  by  their  own  vital  force,  this  symposium  is  bound  to 
make  its  influence  felt  long  and  far. 

"Third,  the  new  sense  of  common  cause  felt  hy  those  leaders  indi- 
vidually, and  expressed  in  the  plan  for  continuing  the  National  Council 
permanently.  This  is  what  bids  fair  to  be  epoch-making.  Not  as  an 
organization  for  either  offense  or  defense;  nor,  indeed,  for  any  direct 
action  upon  the  current  issues  that  agitate  this  or  that  branch  of  insur- 
ance to-day  and  can  best  be  dealt  with  by  the  existing  organizations  or 
by  special  campaigns.  No;  its  purposes  are  deeper  and  broader;  its 
influence  will  lie  not  in  actions,  but  in  ideas.  No  organization  machinery 
is  planned  for  it  such  as  could  be  made  to  work  for  any  particular  or 
selfish  interest.  At  any  such  attempt  it  would  fall  to  pieces.  Voluntaiy 
cohesion  is  its  only  bond;  substantial  unanimity  its  only  strength.  Its 
one  product  is  ideas;  its  one  purpose  to  serve  all  insurance  and  all  the 
people. 

"The  first  great  task  of  the  National  Insurance  Council  is  to  publish 
the  record  and  addresses  of  the  Congress  and  to  distribute  them  as 
widely  as  possible  throughout  and  beyond  our  own  ranks,  in  complete 
form  and  also  in  separate  pamphlets  or  volumes. 

"The  central  idea  that  the  National  Insurance  Council  pennanently 
stands  for  is  that  insurance  of  every  kind,  while  it  must  be  operated 
strictly  as  a  business  to  be  at  all  efficient,  is  in  its  essence  and  results 
not  nearly  so  much  a  mere  business  as  it  is  a  great  cooperation  of  peo- 
ple; a  social  process;  a  branch  of  Social  Economy.  This  central  idea, 
as  it  is  gradually  grasped  and  dwelt  upon  by  all  insurance  men,  will  give 
us  all  a  realizing  sense  of  our  common  cause  and  we  will  readily  evolve 
the  related  ideas  that  can  best  be  discussed  and  propagated  in  common. 

"As  the  people  at  large  also  come  to  realize  the  true  social  status  of 
all  insurance,  their  whole  habitual  attitude  toward  each  branch  will  be 
profoundly  affected,  with  practical  results  of  greatest  moment  for  them 
and  for  us.  Naught  else  can  make  possible  the  solution  of  such  present 
problems  as  taxation,  uniform  laws,  etc.;  or  the  fast-coming  problems 
of  'Social  Insurance,'  so-called  by  well-meaning  folk,  who,  not  knowing 
that  this  term  properly  describes  the  business  even  as  it  stands,  com- 
monly think  they  must  turn  to  legislative  nostrimas  instead  of  helping 
us  to  develop  and  apply  our  tested  machinery  to  meet  the  growing  needs 
of  modern  society. 

"The  same  high  authority  that  has  finally  classified  insurance  aright 
has  also  created  the  National  Council  itself  and  delegated  its  official 
functions.  The  Council  can  and  should  continue  to  speak  on  these  mat- 
ters, not  as  the  mere  voice  of  insurance  raised  in  its  own  interest,  but 
as  the  official  body  commissioned  by  the  International  Exposition  and 
the  governments  behind  it  to  gather  from  all  sources  and  to  disseminate 
everywhere  the  great  foimdation  truths  of  insurance  and  its  relations 
to  society.  It  can  speak  verily  'as  one  having  authority.'  As  such,  its 
voice  will  have  a  distinctive  carrying  quality,  both  to  the  ears  of  insur- 
ance men  and  to  those  of  the  great  public.  What  other  voice  imaginable 
could  be  more  fit  or  more  likely  to  carry  the  true  social  status  of  insur- 
ance into  the  minds  and  hearts  of  the  people? 


PREFACE 

"And  the  people  are  ready  for  that  message;  the  times  are  ripe  for 
it.  Isolated  individualism,  unbridled  competition,  have  had  their  day. 
Cooperation,  social  solidarity,  are  the  keynotes  of  the  twentieth  century. 
Indi\adualisni  voluntarily  combining  into  collectivism ;  private  business 
becoming  deeply  conscious  of  its  social  relations  and  society  itself  becom- 
ing more  and  more  conscious  of  those  same  relations — these  form  the 
strong  forward  cun-ent  of  the  times.  Insurance  is  now  given  the  right 
and  the  opi^ortunity  to  ride  foremost  on  that  mighty  current;  it  has 
been  ofiBcially  placed  above  the  plane  of  other  business  as  being  a  social 
process  even  more  vitally  than  it  is  a  commercial  process. 

"To  develop  these  great  foundation  truths  in  all  their  fullness  of 
meaning  and  variety  of  application,  and  to  get  them  into  the  more  and 
more  receptive  consciousness  of  the  people — beginning  with  ourselves — 
this  is  the  most  momentous  duty  of  the  present  generation  of  insurance 
men.  On  this,  in  the  last  analysis,  hangs  the  solution  of  the  most  diffi- 
cult problems,  internal  and  external,  that  confront  the  respective 
branches  of  insurance.  This  supreme  duty  can  be  done  by  all  of  us 
together  far  better  than  separately.  The  Great  Commission  for  this 
truly  epoch-making  service  has  been  given  into  the  hands  of  the  National 
Insurance  Council. 

"The  plan  of  organization  was  left  to  be  worked  out  fully  by  a 
Provisional  Central  Committee  and  submitted  to  the  various  organiza- 
tions like  our  own  as  the  basis  for  their  continuing  membership.  In 
general  the  plan  contemplates  that  the  National  Insurance  Council,  to 
meet  at  three-year  intervals,  shall  consist  of  delegates  from  'national 
organizations  of  insurance  and  related  activities,'  each  organization  to 
pay  an  admission  fee  of  $25.00  for  general  administrative  purposes.  No 
other  fees  or  dues  ai'e  now  proposed,  nor  any  office  or  salaried  staff. 
The  governing  body,  to  meet  yearly,  is  the  Central  Committee,  planned 
to  consist  of  not  over  three  members  each  from  the  five  main  classes  of 
insurance — leaving  open  for  the  present  the  question  of  how  the  'related 
activities'  can  best  cooperate  with  the  work  of  this  governing  body. 
The  Central  Committee  Avas  provisionally  constituted  (subject  to  change 
by  any  organization  of  its  individual  membei's  thereof)  by  appointment 
of  the  Executive  Committee  of  the  World's  Insurance  Congress,  the 
Exposition's  own  appointees  and  by  the  unanimous  ratification  of  the 
National  Council  itself — thus  conveying  to  it  the  official  authority  of  the 
entire  movement.  *  *  * 

"The  Central  Committee  has  been  duly  authorized  to  take  entire 
charge  of  the  editing,  publishing  and  distribution  by  sale  or  otherwise 
of  the  proceedings  of  the  Congress  and  other  insurance  events  of  the 
Exposition.  At  their  request.  Commissioner  Hathaway  has  already  taken 
up  the  task  of  preparing  in  typewritten  form  the  entire  record  of  the 
movement,  with  all  addresses  and  papers,  in  shape  for  a  subcommittee 
to  edit  and  arrange  for  publication. 

"The  resolutions  adopted  by  the  World's  Insurance  Congress  through 
its  National  Council,  aside  from  those  referring  to  the  movement  itself 
and  thanking  the  men  who  had  led  and  aided  it,  were  confined  to  two 
matters  of  importance  to  all  insurance  and  the  public,  namely :  taxation 
and  uniform  laws.  No  resolution  was  even  offered  as  to  any  matter 
involving  difference  of  interest  or  opinion.  Thus  clearly  had  the  sense 
of  common  cause  impressed  itself  on  each  individual  through  the  five 
days'  public  sessions  that  preceded  the  Council's  meeting  for  resolutions. 
Doubtless  many,  like  myself,  had  come  to  San  Francisco  far  more  con- 


PREFACE  xi 

seious  of  diversity  than  of  unity,  and  even  somewhat  suspicious  of  what 
the  other  fellow  might  tiy  to  do  there.  I  emphasize  the  change  in  our 
own  attitude  wrought  by  five  days  of  getting  together,  as  being  a  fair 
sample  of  what  can  gradually  be  wrought  out  among  our  fellow  insur- 
ance men  everywhere." 

As  Mr.  Scovel's  report  shows,  the  World's  Insurance  Con- 
gress was  undoubtedly  the  most  notable  insurance  gathering  of 
all  time.  There  assembled  representatives  of  all  classes  of  insur- 
ance and  of  activities  related  to  the  insurance  business ;  and  there 
were  presented  a  series  of  addresses  by  the  recognized  master 
minds  not  only  of  those  engaged  in  insurance  as  a  business,  but  of 
those  whose  commercial  undertakings  are  so  largely  dependent 
upon  the  protection  which  insurance  can  alone  provide. 

The  most  important  concrete  result  of  the  World's  Insurance 
Congress  was  the  creation  of  the  National  Insurance  Council,  a 
permanent  organization,  the  governing  body  of  which  is  the  Cen- 
tral Committee  composed  of  representatives  of  the  fire,  life,  cas- 
ualty and  surety,  marine  and  fraternal  branches  of  insurance. 

At  a  meeting  of  that  Council,  the  following  resolution  was 
unanimously  adopted : 

"Whereas,  it  is  believed  that  a  complete  report  of  this  movement, 
including  publication  of  the  addresses  and  papers  presented  on  these 
many  occasions,  would  afford  a  most  valuable  contribution  to  the  liter- 
ature which  is  needed  for  the  education  of  the  public  and  of  insurance 
men  themselves  concerning  the  value  of  insurance  in  its  many  forms, 
and  the  important  functions  it  performs  in  social  economy, 

"Now,  THEREFORE,  BE  IT  RESOLVED,  as  the  sense  of  the  World's  Insur- 
ance Congress,  that  the  entire  history  of  this  movement  and  the  ad- 
dresses delivered  in  connection  therewith  ought  to  be  preserved,  printed 
and  distributed  as  widely  as  possible,  and  that  before  the  Congi-ess  ad- 
journs a  way  should  be  found  whereby  this  important  result  can  be 
accomplished." 

The  duty  of  publication  was  delegated  to  the  Central  Committee, 
a  subcommittee  of  which  requested  me  to  perform  the  functions 
of  editor — which  functions  I  assumed. 

The  exercise  of  those  editorial  functions  has  involved  the  critical 
task  of  selection  and  elimination  as  regards  the  vast  amount  of 
literary  material  incident  to  the  World 's  Insurance  Congress.  That 
task  would  have  been  relatively  easy  had  not  the  size  of  the  publi- 
cation been  sharply  limited  by  the  funds  at  our  disposal.  As 
that  was  the  case,  however,  the  processes  of  selection  and  elimina- 
tion had  to  be  applied,  though  not  ruthlessly.  Nevertheless,  noth- 
ing of  vital  importance,  I  believe,  has  been  omitted.  Whatever 
material  has  been  omitted  is  scarcely  of  tertiary  or  collateral  im- 
portance and,  though  it  might  have  illuminated  the  text  somewhat 
or  have  been  illustrative,  so  to  speak,  of  the  machinery  of  the  or- 
ganization movement,  yet  its  omission  will  in  no  wise  mar  the 


xii  PREFACE 

symmetry  of  the  contents  of  the  volume.    Perhaps  by  including  it 
we  should  have  been  guilty  of  "padding." 

The  material  has  been  assembled  under  the  following  heads: 

I.    History  and  Orgakization  of  the  World's  Insurance  Congress 
— Preliminary  Events. 
II.     Order  of  Business  of  the  World's  Insurance  Congress. 

III.  Proceedings  op  the  World's  Insurance  Congress. 

IV.  Addresses  Delivered  at  the  World's  Insurance  Congress. 
V.     Appendices  : 

1.  Ecports  and  Eesolutions. 

2.  Articles,  Letters  and  Papers  Relating  to  the  World's  Insur- 
ance Congress  Movement. 

3.  Insurance  Events  and  Exhibits  at  the  Panama-Pacific  Inter- 
national  Exposition. 

4.  Constitution  of  the  National  Insurance  Council. 

A  table  of  contents  and  an  index  provide  a  ready  means  of  refer- 
ence to  the  material  contained  in  the  volume.  It  was  thought  best 
to  group  all  of  the  addresses  rather  than  to  insert  them  in  their 
chronological  order.  By  so  doing,  the  Proceedings  are  not  inter- 
rupted by  addresses  and  the  latter  can  be  found  assembled  in  one 
part  of  the  volume. 

The  book  is  dedicated  to  Mr.  W.  L.  Hathaway,  regarding  whose 
relation  to  this  whole  movement  Mr.  Scovel  has  so  aptly  written 
as  follows: 

"This  report  could  not  properly  close  without  paying  direct  tribute 
to  the  one  man  to  whom  this  whole  movement  is  due;  who  first  conceived 
the  vision  and  Avas  at  every  stage  not  only  the  official  head  but  the  vital, 
energizing  force;  who  declined,  though  urged,  to  accept  official  place  in 
the  permanent  organization,  and  who,  nevertheless,  has  taken  on  his 
shoulders  the  first  and  most  laborious  task  of  that  body." 

F.  Robertson  Jones. 
80  Maiden  Lane, 
New  York  City. 


CONTENTS 

PAGB 

History  and  Organization  of  the  World's  Insurance  Con- 
gress    1 

Preliminary  Activities    ........  1 

The  Executive  Committee 5 

The  National  Council 6 

The  Advisory  Board 10 

Construction  of  Program        . 10 

Permanent  Organization 12 


II.    Order  of  Business  of  the  World's  Insurance  Congress    .  14 

Opening  Session,  October  4th,  1915 14 

Second  Session,  October  5th,  1915 15 

Third  Session,  October  6th,  1915 16 

Fourth  Session,  October  7th,  1915 18 

Fifth  Session,  October  8th,  1915 20 

Sixth   Session,   October  9th,   1915 21 

Seventh  Session,  October  11th,  1915 22 

Eighth  Session,  October  12th,  1915 23 

Ninth  Session,  October  13th,  1915 24 

Tenth  Session,  October  14th,  1915 25 


III.    Proceedings  of  the  World's  Insurance  Congress 

Monday,  October  4th,  1915  . 
Tuesday,  October  5th,  1915  . 
Wednesday,  October  6th,  1915 
Thursday,  October  7th,  1915 
Friday,  October  8th,  1915  . 
Saturday,  October  9th,  1915 
Monday,  October  11th,  1915 
Tuesday,  October  12th,  1915 
Wednesday,  October  13th,  1915 
Thursday,  October  14th,  1915 


27 

27 
33 
39 
47 
51 
55 
59 
60 
64 
68 


IV.    Addresses  Delivered  at  the  World's  Insurance  Congress 
(See  also  Alphabetical  Index  following) 


72 


xiv  CONTENTS 

PAGE 

V.    Appendices 426 

(See  also  Alphabetical  Index  following) 


I.     Reports  and  Resolutions 426 

Report  of  Resolutions  Committee 426 

Report  of  Committee  on  Permanent  Organization        .         .     428 
Tentative  Plan  for  Organization   of  a  National  Insurance 

Coimcil 429 

Resolution  Drafted  by  Arthur  I.  Vorys  for  Adoption  by  the 
National  Council,  Commending  the  Services  of  Commis- 
sioner W.  L.  Hathaway 430 


II.     Articles,  Letters  and  Papers  Relating  to  World's  Insurance 

Congress  Movement 431 

{See  also  Alphabetical  Index  following) 


III.     Insurance  Events  and  Exhibits  at  the  Panama-Pacific  Inter- 
national Exposition 520 

Fire  Prevention  Day — Insurance  Day 521 

"Nine  Years  After"  Event 536 

Fire  Undei-writers'  Day 557 

Fraternal  Day 567 

Exhibits 582 


IV.     Constitution  of  the  National  Insurance  Council      .        .        .    596 


ALPHABETICAL  INDEX 

PAGE 

Abbott,  L.  E.,  Address,  "The  Safety  Work  of  Railroads"     .        .  414 
Adderly,  J.   C,  Address,  "National  Association  of  Mutual  Insur- 
ance   Companies" 199 

Advertising  Association  of  San  Francisco,  Resolutions  on  "In- 
surance   Day" 523 

Arlett,  Arthur,  Address  in  Behalf  of  Governor  Hiram  W.  John- 
son,  "Nine   Years   After"    Celebration 542 

Baen,  C.  E.,  Address,  "National   Association  of  Credit  Men"         .  242 
Barendt,  Arthur  H.,   Address  of  Welcome  in   Behalf  of  Mayor 

Rolph   of   San   Fi'anciseo 75 

Beckett,    Dr.    W.    W.,    Address,    "Association   of   Life    Insurance 

Medical   Directors" 197 

Blackburn,  T.  W.,  Address,  "State  Supervision"     ....  287 

BoAK,  I.  I.,  Address,  "National  Fraternal  Congress  of  America"         .  155 
BoYER,  C.  H.,  Paper,  "Safety  First  Movement  of  the  World's  In- 
surance Congress"          .........  495 

Britton,  John  A.,  Paper,  "American  Institute  of  Electrical  Engi- 
neers"       260 

BuLKELEY,  Morgan  G.,  Address,  "Nine  Years  After"  Celebration     .  541 

Burns,  Mrs.  Frances  E.,  Address,  Fraternal  Day  Exercises    .        .  577 
Clampett,    Dr.    Frederick    W.,    Chainnan    Thanksgiving    Ser\aces, 

"Nine  Years  After"  Celebration,  Introductory  Address  .  .  545 
Coffin,  Charles  F.,  Address,  "National  Supervision"  .  .  .  329 
Coffin,  Harry  P.,  Address,  "Safety  First  Federation  of  America"  236 
Cooper,  E.  C,  Insurance  Commissioner,  Bulletin,  "Insurance  Day"  .  522 
Cottrell,  Dr.  F.  G.,  Address,  "United  States  Bureau  of  Mines"  .  219 
Cox,  Robert  Lynn,  Report  of  the  Resolutions  Committee  .  .  426 
Davis,  Samuel,  Address,  "National  Supervision"  ....  320 
Dawson,  Miles  M.,  Address,  "Life  Conservation  and  Social  Econ- 
omy"        402 

De  Leon,  E.  W.,  Poem,  "Equality" 448 

Address,  "International  Association  of  Casualty  and  Surety  Un- 
derwriters"       173 

De  Young,  M.  H.,  Special  Chairman,  Fifth  Day        .        .        .        .268 
DiGGS,  W.  S.,  Paper,  "Possibilities  of  the  World's  Insurance  Con- 
gress"       488 

Done,  Willard,  Address,  Insurance  Day  Exercises,  April  18,  1914    .  530 

Special  Chainnan,  Third  Day 149 

XV 


xvi  ALPHABETICAL  INDEX 

FAGB 

Dryden,  Forrest  F.,  Paper,  "The  World's  Insurance  Congress — Its 

Aims  and  Opportunities" 476 

DurrON,  William  J.,  Address,  Fire  Underwriters'  Day  Exercises    .  561 
FiSKE,   Haley    (read  by   George  B.   Scott),  Paper,  "Service   Per- 
formed by  Life  Insurance  Companies" 106 

French,  Will  J.,  Address,  "Industrial  Safety"        .         .         .        .420 

Gilbert,  Frank  L.,  Address,  "Service  Performed  by  Surety  Com- 
panies"         ...........  102 

GiLLETT,  Hon.  J.  N.,  Address,  "Service  Performed  by  Insurance"     .  86 
Hamilton,  Isaac  Miller,  Address,  "American  Life  Convention"     .  150 
Hathaway,  W.  L.,  Address  before  Convention  of  National  Associa- 
tion of  Life  Underwriters,  Atlantic  City,  Sept.  18,  1913     .        .  437 
Reply  to  open  letter  of  Darwin  P.  Kingsley,  June  16,  1914        .  456 
Correspondence  in  re  Publication  of  This  Work    ....  516 

Introductory  Remarks,  Insurance  Day  Exercises,  April  18,  1914     .  524 

Address,  Fire  Underwriters'  Day  Exercises,  April  21,  1915     .         .  558 

Address  of  Welcome,  Fraternal  Day  Exercises,  April  22,  1915       .  571 

Address,  "A  Statement  of  Facts" 27 

Hawxhurst,  Arthur,  Address,  "A  Prominent  Department  Store"     .  225 
Hoffman,  Dr.  Frederick  L.,  Address,  "Insurance  and  the  Conser- 
vation of  Human  Life"         ........  365 

Holland,  Charles  H.,  Report  of  the  Committee  on  Permanent  Or- 
ganization        428 

Address,  "Safety  Work  of  Insurance  Companies"         .        .         .  410 

Insurance  Field,  Paper,  "Your  Friend — and  Mine"        .        .        .  503 

Johnson,  Governor  Hiram  W.,  Proclamation,  Fire  Prevention  Day  521 

Proclamation,  "Nine  Years  After"  Celebration         ....  536 

Jones,  F.  Robertson,  Address,  "Taxation  of  Insurance  Companies 

for  Revenue" 275 

Jordan,  Dr.  David  Starr,  Address,  "Through  the  Cooperative  Life 

in  the  Tnumph  of  Peace" 551 

Address,  "Governmental  Obstacles  to  Insurance"     ....  337 

Address,  "War,  Business  and  Insurance"         .....  350 
Kingsley,   Darwin   P.,   Open   Letter   to   Commissioner   Hathaway, 

May  15,  1914 451 

Address,  "Response  to  Welcome" 77 

Lentz,  John  J.,  Special  Chainnan,  Fraternal  Day  Exercises,  April 

22,  1915,  Introductory  Address 568 

Levison,  J.  B.,  Address,  "Sei-vice  Perfonned  by  Marine  Insurance 

Companies" 143 

Lynch,  James  K.,  Address,  "American  Institute  of  Banking"        .  252 

Lynch,  Robert  Newton,  Special  Chairman,  Fourth  Session,  Open- 
ing Address 204 

Matheson,  Lieut.  Duncan,  Address,  "Safety  First  from  a  Street 

Traffic    Standpoint" 423 


ALPHABETICAL  INDEX  xvii 

PAGE 

McCoRMiCK,  E.  0.,  Address,  "Southern  Pacific  Company"        .        .    205 
Special  Chairman,  Tenth  Session,  Opening  Address        ...      68 

McKee,  Mark  T.,  Address,  "National  Comicil  of  Insurance  Federa- 
tion Executives" ^^^ 

McMuLLEN,  Frank  E.,  Address  on  Behalf  of  Edward  A.  Woods        .    298 

McQuAiDE,  Rev.  Joseph  P.,  Address,  "The  New   San  Francisco," 

"Nine  Years  After"  Celebration    . ^^ 

Medcraft,  R.  C,  Acceptance  of  Medal,  Fire  Underwriters'  Day  Ex- 

....    560 
ercises    ....-•••• 

Metropolitan  Life  Insurance  Company,  Paper,  "The  Social  Pro- 
gram of  Present  Day  Life  Insurance"     .        .  ...    485 
Meyer,  Rabbi   Martin  A.,   Address,   "The  Brotherhood  of  Man," 

"Nine  Years  After"  Celebration 554 

Miller,  George  W.,  Paper,  "National  Supervision"         .        .        .306 
Miller,  T.  L.,  Address,  "Service  Performed  by  Life  Insurance  Com- 
panies"   ^^^ 

Moore,  Charles  C,  Address  of  Welcome,  Insurance  Day  Exercises, 

April   18,  1914 525 

Address,   "Nine  Years   After"   Celebration 540 

Address  and  Presentation  of  Medal  to  Fire  Underwriters'  Asso- 
ciation     559 

Address,  "World's  Insurance  Congress  Movement"         ...       83 
MULLALLY,    Thornwall,    Chainiian,    Address,    "Nine   Years    After" 

Exercises 539 

Nichols,  Right  Rev.  William  Ford,  Bishop  of  California,  Invoca- 
tion, "Nine  Years  Aftei-"  Celebration 547 

O'Mally,  M.  a,  Address  of  Welcome,  Fraternal  Day  Exercises        .     572 
OsBORN,  R.  W.,  Address,  "Service  Performed  by   Fire   Insurance 

Companies" ^5 

Acceptance  of  Medal  for  Fire  Patrol 67 

Peabody,  Charles  A.,  Paper,  "Association  of  Life  Insurance  Presi- 
dents"      ISO 

Pickell,  Charles  Warren,  Paper,  "The  World's  Insurance  Con- 
gress"      ■^'^ 

Pierce,  Dr.  C.  C,  Address,  "Human  Life  as  a  National  Asset"         .    386 
Pope,  Alvin  E.,  Address,  "The  Force  of  Insurance  in  Social  FiCon- 

omy" 146 

Address,  "What  the  Panama-Pacific  International   Exposition  Is 
Doing  for  the  Cause  of  Life  Conservation"         .         .         .         .394 
Porter,  Warren  R.,  Response  to  Welcome,   Insurance  Day   Exer- 
cises, April  18,  1914 528 

Resolutions  by  Leading   Clergymen  in   re   Thanksgiving   Service, 

"Nine  Years  After"  Celebration 544 

RiTTENHOUSE,  E.  E.,  Paper,  "Excessive  Waste  of  Human  Life"  .  483 
Paper,  "America's  Pressing  Mortality  Problem"  .  .  .  .487 
Address,  "Life  Extension  Institute,  Incorporated"  .  .  .211 
Address  and  Acceptance  of  Medal    .        .        .        .        .        •        •    361 


xviii  ALPHABETICAL  INDEX 

PAGE 

RoLPH,  ^Iayor  James,  Jr.,  Proclamation,  Fire  Prevention  Day        .  522 

Address  of  Welcome,  Insurance  Day  Exercises,  April  18,  1914        .  527 

Proclamation,  "Nine  Years  After"   Celebration      ....  537 

Address,   "Nine  Years  After"   Celebration 543 

Rotary  Club  op  San  Francisco,  Resolution  on  "Insurance  Day"    .  523 

RowELL,  Chester  H.,  Address  of  Welcome  in  Behalf  of  Governor 

Jolmson  of  California    .........  73 

ROYCE.  Prop.  Josiah,  Address,  "International  Insurance"         ,         .  344 

San  Francisco   Call  and   Post,   Editorial   on   World's  Insurance 

Congress 449 

San  Francisco  Chronicle,  Editorial  on  World's  Insurance  Congi-ess  450 

Scovel,  Charles  W.,  Address,  "Service  Performed  by  Life  Insur- 
ance Companies" 126 

Sexton,  William,  Address,  "The  Relation  of  Fire  Insurance  to  the 

Exposition" 273 

Sherman,  Dr.  Harry  M.,  Address,  "Life  Conser\^ation  and  Medi- 
cine"         396 

Sherman,  Senator  Lawrence  Y.,  Special  Chairman,  Opening  Ad- 
dress         91 

SiMMS,  Dan  W.,  Address  before  American  Life  Convention,  Dallas, 
Texas,   Oct.   9,  1914,  "Federal   Super\ision  of  Life  Insurance: 

Possibility— Feasibility" 461 

Sturgis,  R.  Clipston,  Address,  "American  Institute  of  Architects"    .  256 

Tappinder,  Will  G.,  Address  before  National  Association  of  Life 

Underwriters,  Memphis,  Sept.  17,  1912 431 

Treat,   E.  M.,  Address,   "Ser\dce   Perfoi-med  by   Credit  Insurance 

Companies" 139 

Van  Sciiaack,  David,  Address,  "Service  Perfoi-med  by  Casualty  and 

Liability  Companies" 119 

VoRYS,  Hon.  Arthur  L,  General  Chainnan,  Opening  Address        .  72 

Address,  "American  Bar  Association" 246 

Ward,  H.  H.,  Address,  "National  Association  of  Life  Underwriters"  164 

Watt,  Rolla  V.,  Address,  Fire  Undei-writers'  Day  Exercises    .        .  563 

Special  Chairman,  "Peace  Day,"  Opening  Address        .         .        .  343 

Wentworth,  Franklin  H.,  Address,  "National  Fire  Protection  As- 
sociation"         177 

Acceptance  of  Medal  and  Address 65 

Wheeler,  Benjamin  Ide,  Address,  "Crowned  by  the  World's  Expo- 
sition," "Nine  Years  After"  Celebration 550 

Wilson,  William  G.,  Address,  "National  Association  of  Casualty 

and  Surety  Agents" 194 

Woods,  Edward  A.,  Paper,  "Policyholders  Burdened  by  Taxes"        .  481 

Paper,  "Taxation  for  Revenue" 298 

Woodworth,  C.  H.,  Address,  "National  Association   of  Insurance 

Agents" 160 

Woolard,  Sam  F.,  Paper,  "Our  Fire  Waste  a  National  Disgrace"     .  499 


WORLD'S  INSURANCE  CONGRESS 
SAN  FRANCISCO,   1915 


HISTOKY  AND  ORGANIZATION  OF  THE  WORLD'S 
INSURANCE  CONGRESS 

Preliminary  Activities 

The  World 's  Insurance  Congress  had  its  inception  in  the  conven- 
tion of  the  National  Association  of  Life  Underwriters  held  at 
Detroit  in  September,  1910,  when  W.  L,  Hathaway,  of  San  Fran- 
cisco, suggested  the  idea  in  an  informal  way  to  some  of  the  leading 
spirits  of  the  convention.  Encouraged  by  the  enthusiastic  response 
to  his  proposal,  Mr.  Hathaway  proceeded  to  interest  prominent  in- 
surance men  in  New  York,  where  he  received  further  assurances  of 
support  for  his  project. 

On  October  14,  1910,  at  the  regular  monthly  meeting  of  the  San 
Francisco  Life  Underwriters  Association,  Mr.  Hathaway  secured 
the  adoption  of  a  resolution  by  which  the  Association  committed  it- 
self favorably  to  the  holding  of  the  "World 's  Insurance  Congress  in 
San  Francisco  in  the  year  1915,  and  authorized  the  appointment 
of  an  organization  committee.  The  committee  appointed  pursuant 
to  this  resolution  consisted  of  W.  L.  Hathaway,  Chairman,  George 
B.  Scott,  and  John  Landers.  William  J.  Bell,  president  of  the  San 
Francisco  Association,  being  later  added  by  request  of  the  other 
members  of  the  committee. 

This  committee  inaugurated  a  campaign  among  the  insurance  men 
of  San  Francisco,  and,  after  something  over  fifty  applicants  for 
membership  had  been  obtained,  the  first  formal  meeting  was  held, 
at  which  the  following  resolutions  were  adopted : 

First:  The  name  of  this  organization  shall  be  "Panama-Pacific 
World's  Insurance  Congress." 

Second :  The  object  of  its  organization  shall  be : 

(1)  To  conduct  activities  calculated  to  influence  all  associations, 
societies  and  business  organizations  having  an  interest  in  the  sub- 
ject of  insurance  in  any  of  its  branches,  to  hold  their  conven- 
tions or  meetings,  during  the  year  1915,  in  the  city  and  county  of 
San  Francisco. 

(2)  To  conduct  activities  and  carry  out  such  plans  as  may  be 
found  necessary  and  expedient  to  bring  about  a  great  World's  In- 
surance Congress  during  the  time  that  the  various  societies,  asso- 

1 


2        WORLD'S  INSURANCE  CONGRESS 

ciations  and  organizations  are  separately  holding  their  conventions 
or  meetings  in  this  city  in  the  year  1915. 

(3)  To  conduct  activities  calculated  to  influence  all  individuals 
throughout  the  world,  who  are  engaged  or  interested  in  any  of  the 
branches  of  insurance,  to  a  favorable  consideration  of  this  World 's 
Insurance  Congress,  and  particularly  with  regard  to  getting  their 
personal  pledges  to  attend,  and  their  influence  upon  others  to  do  so. 

(4)  Permitting  such  other  enlargement  of  the  scope  of  activi- 
ties as  developments  may  require  and  the  organization  may  adopt. 

Third:  The  existence  of  this  association  shall  be  limited  to  the 
time  necessary  to  promote  and  carry  out  the  existence  of  said 
World's  Congress  of  insurance  interests,  and  the  winding  up  of 
the  details  connected  with  its  conduct. 

Mr.  Hathaway  was  continued  as  chairman  of  the  organization, 
and  under  his  direction  letters  were  sent  out  to  over  thirty-two 
thousand  insurance  men  throughout  the  world,  the  letterheads  bear- 
ing the  following  invitation : 

Panama-Pacific  World's  Insurance  Congress 

San  Francisco,  1915 

iisrviTES 

all  associations  or  societies,  either  of  a  business  or  profes- 
sional nature,  whose  membership  derive  their  livelihood 
from  the  commerce  of  insurance,  to  hold  their  conventions 
or  meetings  in  the  city  of  San  Francisco  in  the  year  1915, 
when  a  World's  Congress  of  insurance  interests  will  be 
held  separate  and  apart  from  the  regular  annual  proceed- 
ings of  the  various  associations  or  societies. 

In  December,  1911,  a  souvenir  holiday  greeting  card  was  sent 
out  from  individuals  connected  with  the  insurance  fraternity  in 
San  Francisco  to  their  friends,  correspondents  and  the  press 
throughout  the  world,  the  preparation  and  mailing  of  which  cost 
approximately  $7,500,  and  which  resulted  in  extensive  publicity 
favorable  to  the  movement  and  elicited  further  correspondence 
from  those  in  whom  it  had  awakened  an  interest. 

The  Congress  was  not  originally  an  exposition  undertaking.  It 
had,  in  fact,  been  proposed  before  the  matter  of  liolding  an  exposi- 
tion at  San  Francisco  was  finally  decided  upon.  However,  the  ad- 
vantage of  bringing  the  Congress  under  exposition  auspices  was 
recognized  by  i\Ir.  Hathaway,  and  he  approached  President  Charles 
C.  Moore  of  the  Exposition  with  that  end  in  view.  Mr.  ^Moore  re- 
quested him  to  furnish  proof  that  the  insurance  fraternity  of 
California  desired  assistance  and  would  continue  to  support  the 
movement  if  made  an  official  part  of  the  Exposition.  Satisfactory 
proof  was  presented  in  the  form  of  a  petition  signed  by  eighty- 
two  of  California's  representative  insurance  men  on  December  22, 
1911. 


WORLD'S  INSURANCE  CONGRESS  3 

After  a  careful  investigation  of  the  matter,  President  Moore  ac- 
corded official  recognition  to  the  movement  by  creating  the  office 
of  Commissioner  of  Insurance,  to  have  the  supervision  and  con- 
trol of  all  insurance  affairs  connected  with  the  Exposition.  The 
most  logical  nominee  for  this  important  office  was  W.  L,  Hatha- 
way, who  was  duly  appointed  thereto,  together  with  an  executive 
committee  composed  of  William  J,  Button,  Chairman,  George  I. 
Cochran,  E.  C.  Cooper,  W.  E.  Dean  and  F.  F.  Taylor.  There  were 
also  appointed  various  Committees  on  Participation  and  Attend- 
ance for  the  different  branches  of  insurance  and  allied  interests, 
and  an  Entertainment  Committee. 

The  first  step  taken  under  Exposition  auspices  to  carry  the  work 
of  the  Commission  into  foreign  lands  was  the  directing  of  a  letter 
to  the  San  Francisco  consuls  of  the  various  governments.  That 
letter  so  well  sets  forth  the  international  aspect  of  insurance  that 
it  properly  becomes  a  part  of  the  history  of  a  movement  which 
aimed  to  secure  for  insurance  international  recognition  of  its  true 
purposes : 

The  World's  Insurance  Congress,  to  be  held  in  San  Francisco  in 
1915,  becomes  a  matter  of  broadest  international  importance,  and 
deserves  special  mention  in  your  reports  for  the  following  reasons : 

First — This  will  be  the  first  great  World's  Insurance  Congress 
ever  held. 

Second — Insurance  in  its  various  forms,  as  represented  by  many 
of  the  big  companies  of  the  world,  regardless  of  the  country  by 
which  they  are  chartered,  has  become  more  truly  international  in 
its  scope  of  operation  than  any  other  subject  of  commerce. 

Third — Many  of  these  companies,  through  this  extension  of  their 
activities,  have  become  real  world  powers  in  the  domain  of  finance, 
and  have  a  deep  interest  in  the  economic  problems  that  confront 
all  people. 

Fourth — The  nature  of  their  business  comes  nearer  combining 
the  altruistic  and  commercial  instincts  of  man  than  any  other  ex- 
tensive activities. 

Fifth — It  is  estimated  that  approximately  1  per  cent  of  the 
total  population  of  the  countries  of  leading  commercial  activites 
derive  their  livelihood  from  the  commerce  of  insurance  and  its 
allied  professions,  and  as  this  1  per  cent  is  wholly  of  the  more  rep- 
resentative class,  their  actual  per  cent  of  influence  to  the  total 
population  becomes  very  large,  and  might  safely  be  represented  by 
10  per  cent  of  the  total. 

Sixth — Insurance  has  assumed  a  very  large  per  cent  of  its  pres- 
ent financial  and  economic  importance  during  the  lifetime  of  many 
of  the  men  now  at  the  head  of  the  various  institutions,  and  the 
importance  of  a  Congress  in  which  these  minds  will  all  have  repre- 
sentation during  their  activity  assumes  a  tremendous  economic 
importance. 

Seventh — As  war  is  the  destroyer  of  every  form  of  insurance 
risk,  this  Congress  will  be  the  greatest  international  peace  gather- 
ing that  the  world  has  ever  witnessed. 


4        WORLD'S  INSURANCE  CONGRESS 

The  contents  of  this  letter  were  duly  transmitted  to  the  differ- 
ent governments  in  consular  reports,  thus  placing  the  matter  be- 
fore the  foreign  insurance  men  in  an  official  way.  To  further  this 
object,  a  number  of  American  insurance  men,  who  at  different 
times  visited  Europe,  were  appointed  Special  Commissioners  by 
the  Exposition  and  while  abroad  did  much  to  convey  in  a  personal 
way  an  understanding  of  what  the  Congress  promoters  hoped  to 
Accomplish  for  insurance  as  a  whole.  In  addition  to  this,  the 
names  of  the  men  of  leading  influence  in  European  insurance 
■circles  were  procured  and  personal  letters  written  them. 

This  foreign  campaign,  conducted  in  three  channels  (government 
reports,  personal  visits  and  correspondence),  resulted  in  arousing 
a  degree  of  interest  almost  surpassing  that  evinced  in  America. 
So  impressed  were  the  insurance  men  of  Europe  with  the  possi- 
bilities for  good  existing  in  a  World's  Congress  of  Insurance  that 
the  International  Bureau  of  Insurance,  which  is  the  central  body 
of  European  insurance  interests  and  which  at  its  triennial  meet- 
ing in  London  in  1912  drew  over  100,000  people,  voted  to  set  aside 
its  convention  scheduled  for  1915,  and  recommended  that  in  its 
stead  the  various  bodies  comprising  its  membership  cause  their 
delegates  to  attend  the  World's  Insurance  Congress  of  1915.  Had 
it  not  been  for  the  great  European  War,  there  can  be  no  question 
but  that  this  Congress  would  have  been  truly  a  World's  Congress 
in  the  broadest  sense  of  the  word. 

While  much  attention  was  thus  given  to  foreign  participation, 
domestic  participation  was  far  from  being  neglected.  Immediately 
upon  the  movement  becoming  an  Exposition  undertaking,  a  regu- 
lar issue  of  news  bulletins  was  inaugurated,  beginning  October 
11,  1912,  and  continuing  until  the  opening  of  the  Congress  itself. 
They  went  to  a  mailing  list  of  over  three  thousand  in  the  United 
States  and  Canada  and  to  some  few  abroad,  and  naturally  served 
to  maintain  interest  as  the  work  progressed.  These  bulletins  were 
directed  not  only  to  insurance  people  but  also  to  the  daily  press 
throughout  the  country.  The  insurance  subject  was  continuously 
and  persistently  kept  to  the  front  in  this  way,  and,  as  much  of  the 
literature  which  went  from  the  Commissioner's  office  was  of  a 
character  tending  to  enlighten  the  reader  as  to  the  breadth  of  in- 
surance service  in  its  many  fields,  it  resulted  in  an  amount  of  news- 
paper publicity  favorable  to  insurance  interests  that  would  be 
hard  to  measure. 

As  the  scope  of  the  Congress  promotion  gradually  extended,  it 
became  necessary  to  secure  the  assistance  of  a  trained  insurance 
man  who  could  devote  all  of  his  time  to  the  increasing  amount  of 
detail  work  devolving  upon  the  Commissioner's  office;  so  on  Feb- 
ruary 1,  1914,  Mr.  Gamer  Curran  was  appointed  Deputy  Com- 
missioner and  Secretary  of  the  Executive  Committee  of  the  World's 
Insurance  Congress  Events,  and  the  offices  of  the  Commission  were 
considerably  enlarged. 

In  November,  1914,  Commissioner  Hathaway  invited  all  persons 


WORLD'S  INSURANCE  CONGRESS  5 

engaged  in  the  insurance  business  or  its  allied  professions  to  sub- 
mit designs  for  an  oflSeial  seal,  and,  to  stimulate  effort  in  this 
direction,  offered  to  the  successful  contestant  free  admission  to 
the  Exposition  and  all  concessions.  The  contest  was  won  by  Gar- 
rett Brown,  editor  of  hisurance  Leader,  of  St.  Louis,  and  the  seal 
went  on  the  back  of  practically  every  envelope  that  left  an  insur- 
ance office  in  San  Francisco. 

The  year  1914  saw  marked  progress  in  organization  work.  The 
insurance  world  had  become  educated  to  the  idea  of  a  World's  In- 
surance Congress.  Many  associations,  which  had  not  previously 
come  into  line  for  lack  of  a  full  understanding  of  the  project,  saw 
the  light.  Likewise  many  men  prominently  connected  with  insur- 
ance affairs  took  increased  interest,  and  some  took  occasion  to  pre- 
sent to  the  Commission  their  views  on  subjects  of  national  interest 
which  they  believed  could  be  furthered  by  connection  with  the 
Congress.  Others  had  definite  ideas  of  what  it  could  accomplish 
and  set  them  forth  in  open  letters  or  articles  written  for  circula- 
tion. The  first  subject  presented  for  consideration  was  Federal 
Supervision.  Darwin  P.  Kingsley,  President  of  the  New  York 
Life  Insurance  Company,  who  is  known  as  the  country's  foremost 
advocate  of  that  mode  of  supervision,  directed  an  open  letter  to 
the  Commissioner  requesting  cooperation  of  the  Congress,  and  that 
letter  together  with  its  reply  received  wide  circulation.  This  let- 
ter, its  reply  and  a  number  of  other  similar  letters  and  articles 
indicative  of  insurance  sentiment,  are  reproduced  elsewhere  in 
this  work.     (See  page  451  j^.) 

The  Executive  Committee 

The  personnel  of  the  Executive  Committee  of  the  World's  Insur- 
ance Congress,  in  the  five  years  of  preparatory  work,  underwent 
changes  brought  about  by  resignations  and  retirements  from  the 
insurance  business. 

E.  C.  Cooper  tendered  his  resignation  at  the  time  of  his  retire- 
ment from  the  Insurance  Commissionership  of  the  State  of  Cali- 
fornia; W,  E.  Dean  did  likewise  upon  his  retirement  from  the 
insurance  busness;  and  F.  F.  Taylor  also  by  reason  of  his  many 
other  activities  which  prevented  the  devotion  of  necessary  time  to 
work.  Charles  H.  Holland,  C.  I.  Hitchcock  and  Willard  Done  were 
selected  to  fill  these  vacancies  so  that  the  committee  was  then  as 
follows : 

The  Executive  Committee  as  at  present  constituted  stands  as 
follows : 

William  J.  Dutton, 

Ex-president  Firemen 's  Fund  Insurance  Co. 
Charles  H.  Holland, 

General  Manager,  Royal  Indemnity  Co. 
George  I.  Cochran, 

President,  Pacific  Mutual  Life  Insurance  Co. 


6         WORLD'S  INSURANCE  CONGRESS 

Willard  Done, 

Ex-Commissioner  of  Insurance,  State  of  Utah. 
C.  I.  Hitchcock, 

President,  The  Insurance  Field  Co.,  Inc. 

During  the  formation  period  of  the  Congress,  the  above  commit- 
tee, together  with  the  Commissioner,  acted  as  the  executive  head 
of  the  National  Council. 

The  National  Council 

The  most  vital  part  of  the  entire  scheme  of  organization  of  the 
World's  Insurance  Congress  has  been  the  National  Council.  Com- 
posed of  delegates  from  practically  eveiy  national  or  sectional  as- 
sociation directly  or  indirectly  related  to  insurance,  it  has  repre- 
sented the  focal  point  of  insurance  ideas. 

It  is  a  body  unique  in  the  annals  of  insurance,  for  never  before 
had  all  of  the  various  branches  affiliated  themselves  in  a  single  or- 
ganization. The  initial  step  in  its  formation  vras  to  secure  the 
endorsement  of  the  body  whence  the  entire  movement  sprung — The 
National  Association  of  Life  Underwriters.  Accordingly,  a  spe- 
cial commissioner.  Will  G.  Taffinder,  appointed  by  the  President 
of  the  Exposition,  visited  the  Memphis  Convention  of  that  Asso- 
ciation and  on  September  17th,  1912,  delivered  one  of  the  memor- 
able addresses  of  the  Congress  movement.  He  explained  the 
purposes  of  the  proposed  National  Council  and  suggested  to  the 
Convention  that  it  nominate  the  first  member.  His  address  on  this 
occasion  will  be  found  at  page  431. 

In  response  to  this  suggestion,  the  first  delegate  to  the  Council 
was  selected,  George  A.  Rathbun,  of  Los  Angeles.  The  next  asso- 
ciation to  meet  in  annual  convention  was  that  of  the  Life  Insurance 
Presidents.  George  I.  Cochran,  President  of  the  Pacific  Life  In- 
surance Company,  attended  as  special  commissioner,  and  so  ably 
did  he  present  the  merits  of  the  Congress  movement  that  the 
Association,  on  December  6th,  1912,  passed  the  following  reso- 
lution : 

Whereas,  A  communication  has  been  delivered  to  this  Conven- 
tion by  Special  Commissioner  George  I.  Cochran,  from  the  Com- 
missioner of  the  World's  Insurance  Congress,  which  meets  in  San 
Francisco  in  1915,  inviting  this  association  to  designate  a  member 
to  represent  it  on  the  National  Council  of  such  Congress ;  and 

Whereas,  Such  invitation  is  appreciated  and  it  seems  desirable 
that  this  Association  be  so  represented  in  the  National  Council  of 
the  World 's  Insurance  Congress, 

Now,  Therefore,  Be  It  Resolved,  That  this  Convention  do  here- 
by commission  Hon.  Robert  Lynn  Cox  as  its  representative  to 
serve  in  that  capacity. 

The  next  organization  to  come  in  was  the  Fire  Underwriters' 
Association  of  the  Pacific  (March,  1913).     That  was  followed  by 


WORLD'S  INSURANCE  CONGRESS  7 

the  Insurance  Institute  of  America  and  the  American  Life  Con- 
vention (June,  1913).  Thus  the  movement  spread  until  it  em- 
braced the  whole  of  the  following  list,  numbering  one  hundred  and 
fifteen  associations  at  the  time  of  the  convening  of  the  World's 
Insurance  Congress: 

Actuarial  Society  of  America — July,  1913. 

American  Association  of  Accident  Underwriters — December,  1913. 

American  Association  of  Medical  Examiners — July,   1914. 

American  Bar  Association — July,  1915. 

American  Electric  Railway  Association — August,  1915. 

American  Institute  of  Actuaries — March,  1914. 

American  Institute  of  Architects — September,  1914. 

American  Institute  of  Banking — January,   1915. 

American  Institute  of  Electrical  Engineering— September,  1915. 

American  Institute  of  Marine  Underwriters — June,  1915. 

American  Institute  of  Steam  Boiler  Inspectors — October,  1914. 

American  Mine  Safety  Association — January,  1915. 

American  Museum  of  Safety — December,  1914. 

American  Peace  Society — January,  1915. 

American  Society  for  Fire  Prevention — April,  1914. 

American  Statistical  Association — July,  1914. 

Ancient  and  Honorable  Order  of  the  Blue  Goose— March,  1914. 

Association  of  Casualty  and  Surety  Insurance  Presidents— Octo- 
ber, 1914. 

Association  of  Life  Insurance  Counsel — May,  1914. 

Association  of  Life  Insurance  IMedical  Directors — October,  1913. 

Association  of  Western  Insurance  Superintendents  of  Canada — 
August,  1914. 

Board  of  Fire  Underwriters  of  Hawaii — May,  1914. 

Board  of  Fire  Underwriters  of  the  Pacific- May,  1914. 

Board  of  Marine  Underwriters  of  San  Francisco — INIarch,  1914. 

Bureau  of  Commercial  Economics,  Washington,  D.  C. — July,  1915. 

Bureau  of  Personal  Accident  and  Health  Underwriters— March, 
1915. 

Bureau  of  Standards,  Washington,  D.  C— September,  1915. 

Bureau  of  War  Risk  Insurance,  Washington,  D.  C— September, 
1915. 

Burglary  Insurance  Underwriters'  Association — July,  1914. 

California  Association  of  Electrical  Inspectors— July,  1914. 

California  State  Association  of  Local  Fire  Insurance  Agents- 
March,  1914. 

Canadian  Life  Insurance  Officers'  Association— January,  1914. 

Casualty  Actuarial  and   Statistical   Society— December,   1914. 

Casualty  Underwriters'  Association  of  California— May,  1914. 

Department  of  Incorporated  IMutuals — July,  1915. 

Detroit  Conference— March,  1914. 

Employers'  Mutual  Casualty  Federation  of  America— July,  1915. 

Factory  Insurance  Association — August,  1914. 


8        WORLD'S  INSURANCE  CONGRESS 

Federated  Fraternities — November,  1913. 

Field  Men's  Association  of  the  Mill  and  Elevator  Mutual  Fire  In- 
surance Companies — May,  1915. 

Fire  Underwriters '  Association  of  the  Northwest — November,  1913. 

Fire  Underwriters'  Inspection  Bureau — May,  1914. 

Fire  Underwriters'  Uniformity  Association — July,  1914. 

Health  and  Accident  Underwriters'  Conference — February,  1915. 

Health  and  Life  Conservation  Bureau  of  the  Pacific — July,  1914. 

Illinois  Insurance  Federation — September,  1915. 

Insurance  Brokers  Exchange  of  San  Francisco — March,  1914. 

Insurance  Federation  of  Indiana — September,  1915. 

Insurance  Federation  of  Iowa — September,  1915. 

Insurance  Federation  of  Kansas — September,  1915. 

Insurance  Federation  of  Michigan — April,  1915. 

Insurance  Federation  of  Minnesota — March,  1915. 

Insurance  Federation  of  Missouri — August,  1914, 

Insurance  Federation  of  Ohio — September,  1915. 

Insurance  Federation  of  Pennsylvania — March,  1915. 

Insurance  Federation  of  the  State  of  New  York — September,  1915, 

Insurance  Institute  of  Toronto — September,  1914. 

International  Association  of  Casualty  and  Surety  Underwriters — 
July,  1913. 

International  Association  of  Fire  Engineers — September,  1915, 

Fire  Marshals'  Association  of  North  America — September,  1915. 

International  Claim  Association — September,  1914. 

International  Federation  of  Commercial  Travelers'  Organizations 
— January,  1915. 

Kentucky  Insurance  Federation — October,  1915. 

Life  Underwriters'  Association  of  Canada — June,  1913. 

Live  Stock  Insurance  Bureau — March,  1915. 

Mainland  Fire  Underwriters'  Association  of  British  Columbia — 
August,  1914. 

Michigan  Fraternal  Congress — June,  1915. 

Mutual  Life  Underwriters — August,  1914. 

National  Association  of  Casualty  and  Surety  Agents — April,  1914. 

National  Association  of  Credit  Men — May,  1914. 

National  Association  of  Electrical  Inspectors — May,  1915. 

National  Association  of  Industrial  Accident  Boards  and  Commis- 
sions— September,  1915. 

National  Association  of  Insurance  Agents — August,  1913. 

National  Association  of  Live   Stock  Insurance  Companies — Feb- 
ruary, 1915. 

National  Association  of  Mutual  Insurance  Companies — May,  1914. 
National  Automatic  Sprinkler  Association — July,  1914. 
National  Board  of  Fire  Underwriters — December,  1913. 
National  Board  of  Marine  Underwriters — July,  1915. 
National  Council  of  Insurance  Federation  Executives — June,  1915 
National  Fire  Protection  Association — August,  1913. 
National  Fraternal  Congress  of  America — September,  1913. 


WORLD'S  INSURANCE  CONGRESS  9 

National  Safety  Council — May,  1914. 

New  England  Congress  of  Life  Underwriters'  Associations — Octo- 
ber, 1914. 

New   England   Women's   Lifei  Underwriters'   Association — July, 
1914. 

Pacific  Casualty  and  Surety  Association — July,  1915. 

Pacific  Claim.  Agents'  Association — July,  1914. 

Pacific  Coast  Adjustment  Bureau — June,  1914. 

Pacific  Coast  Association  of  Fire  Chiefs — October,  1914. 

Pacific  Coast  Automobile  Underwriters'  Association — May,  1914. 

Permanent  Committee  of  the  International  Congresses  of  Actua- 
ries— November,  1914. 

Plate  Glass  Service  and  Information  Bureau — August,  1913. 

Railway  Fire  Protection  Association — January,  1915. 

Rocky  Mountain  Fire  Underwriters'  Association — September,  1914. 

Safety  First  Federation  of  America — August,  1915. 

San  Francisco  Association  for  the  Study  and  Prevention  of  Tu- 
berculosis— October,  1914. 

South-Eastern  Underwriters'  Association — August,  1913. 

Southern  Casualty  and  Surety  Conference — April,  1914. 

Surety  Association  of  America — September,  1913. 

Surety  Underwriters'  Association  of  California — June,  1914. 

Texas  Life  Convention — July,  1915. 

The  Associated  Companies   (Workmen's  Compensation  Insurance 
for  Coal  Mines) — August,  1915. 

The  Western  Union— October,  1913. 

Underwriters'  Bureau  of  New  England — August,  1913. 

Underwriters'  Association  of  the  Middle  Department — September, 
1914. 

Underwriters'  Laboratories,  Inc. — May,  1914. 

United  States  Bureau  of  Mines — December,  1914. 

United  States  League  of  Local  Building  and  Loan  Associations — 
August,  1914. 

Vancouver  Island  Fire  Underwriters'  Association — August,  1913. 

Western  Association  of  Electrical  Inspectors — December,  1914. 

Western  Automobile  Underwriters'  Conference — June,  1914. 

Western  Insurance  Bureau — September,  1913. 

Western  Sprinkler  Risk  Association — January,  1915. 

Workmen's  Compensation  Service  Bureau — March,  1914. 

Extensive  correspondence  passed  between  the  various  members 
of  the  Council  and  the  office  of  the  Commissioner,  and  practically 
all  of  the  ideas  which  found  expression  in  the  World's  Insurance 
Congress  were  brought  to  the  surface  and  their  authors  placed 
on  the  program  as  a  result  of  tabulated  recommendations  which 
came  from  that  source. 

In  the  year  1914  there  were  held  a  number  of  meetings  of  the 
members  of  the  Council  resident  in  or  near  San  Francisco,  at  which 
were  discussed  many  of  the  problems  in  connection  with  the  con- 


10        WORLD'S  INSURANCE  CONGRESS 

duct  of  the  Congress.  As  a  result  of  those  meetings  a  blank  sche- 
dule was  prepared  and  sent  to  all  members  throughout  the  country, 
requesting  expressions  of  opinion  on  the  various  points,  but  most 
especially  in  regard  to  the  formation  of  the  Congress  program. 

The  Advisory  Board 

While  the  National  Council,  representing  the  many  interests 
enumerated,  was  a  prolific  source  of  information  for  the  Com- 
missioner and  his  Eecutive  Committee  in  constructing  a  composite 
program  applicable  and  of  interest  to  all  classes  of  the  business, 
still  the  burden  of  selection  resting  upon  them  was  a  heavy  one. 
So  in  February  of  1915,  when  Commissioner  Hathaway  was  on  an 
extended  Eastern  trip  in  the  interests  of  the  Congress,  after  con- 
sultation with  a  number  of  the  leading  insurance  influences,  an 
Advisory  Board  on  Program,  consisting  of  the  following  gentle- 
men, was  appointed,  and  it  rendered  valuable  aid  in  extracting 
from  the  mass  of  detailed  suggestions  offered  those  which  seemed 
most  worthy  of  consideration: 

Member  Interest  Represented 

Young  E.  Allison Insurance  Journalism 

R.  M.  Bissell Fire  and  Accident  Insurance 

W.  S.  Barnaby Insurance  Journalism 

William  Bro  Smith Life  and  Accident  Insurance 

C,  M.  Cartwright Insurance  Journalism 

Robert  Lynn  Cox Life  Insurance 

J.  M.  Craig Life  Insurance 

George  T.  Dexter Life  Insurance 

W.  S.  Diggs Insurance  Federations 

Forrest  F.  Dryden Life  Insurance 

Henry   Evans Fire  Insurance 

Wade  Fetzer Casualty  Insurance 

John  M.  Holcombe Life  Insurance 

Edson  S.  Lott Casualty  Insurance  ^ 

Henry  C.  Lippincott Life  Insurance 

Charles  W.  Pickell Life  Insurance 

Henr>'  J.  Powell Life  Insurance 

Henry  H.  Putnam Fire  Insurance 

J.  B.  Reynolds Life  Insurance 

E.  G.  Snow Fire  Insurance 

Carl  F.  Sturhahn Fire  Insurance 

M.  F.  Van  Buskirk Fraternal  Insurance 

Miles  M.  Dawson Consulting  Actuary. 

Construction  op  Program 

It  developed  from  the  papers,  correspondence  and  reports  reach- 
ing the  office  of  the  Commissioner  that  there  was  not  a  suflScient 


WORLD'S  INSURANCE  CONGRESS  11 

knowledge  in  the  minds  of  the  public  as  to  the  actual  services  per- 
foraied  by  the  institution  of  insurance,  separate  and  distinct  from 
its  fundamental  purpose  of  indemnity.  It  became  manifest  that 
the  greatest  possible  good  which  could  come  to  insurance  through 
any  source  would  be  popular  enlightenment  as  to  its  constructive 
influence  upon  modern  business. 

It,  therefore,  became  the  object  of  the  program  makers  to  con- 
struct a  platform  which  would  expound  the  cause  of  the  entire 
institution  of  insurance,  placing  on  record  the  close  relationship 
actually  existing  between  all  of  its  separate  influences  in  public 
service. 

The  following  is  quoted  from  the  letter  which  went  as  a  fore- 
word in  regard  to  the  program : 

Each  branch  of  Insurance  performs  a  distinct  service,  but  each 
in  a  measure  overlaps  and  enters  into  the  service  of  the  other. 
Fire  insurance,  in  its  efforts  to  minimize  the  effects  of  this  great 
destructive  agent,  is  also  a  factor  in  the  prevention  of  accidents  and 
the  saving  of  lives ;  life  insurance  teaches  the  lesson  of  thrift  and 
saving  and  caution,  and  adds  to  the  force  of  accident  and  fire  pre- 
vention; accident  insurance,  in  its  prevention  work,  develops  fire 
elimination  ideas  and  is  a  force  in  life  insurance  also.  All  work 
together  for  the  betterment  of  citizenship. 

There  would  appear  to  be  a  community  of  interest  in  these 
forces  that  might  be  made  the  basis  for  joint  educational  plans 
for  teaching  the  Gospel  of  Service,  and  if  the  mighty  forces  of  the 
associations  of  underwriters  of  all  classes  as  they  now  exist  can 
utilize  this  service  as  a  working  basis,  it  should  be  the  means  of 
quickly  spreading  broadcast  an  understanding  of  the  functions  of 
Insurance  and  help  to  solve  the  great  problems  with  which  it  is 
to-day  confronted. 

It  was  not  until  July  of  1915  that  the  Commission  was  able  to 
announce  the  program  as  fully  decided  upon  so  far  as  its  outline 
of  topics  was  concerned ;  and  then  began  the  effort  to  obtain  con- 
tributions from  men  occupying  such  prominent  positions  in  their 
respective  fields  of  endeavor  that  their  words  would  command  the 
attention  and  careful  consideration  of  the  insurance  world ;  for 
aside  from  the  personal  attendance  at  the  Congress  sessions,  it  has 
been  aimed  to  convey  in  printed  form  to  the  insurance  fraternity 
at  large  the  messages  there  delivered. 

To  secure  so  large  a  number  of  representative  speakers  as  was 
necessary  to  fill  the  Congress  program  was  by  no  means  a  simple 
matter,  although  the  extensive  educational  work  already  furthered 
by  the  Commission  had  awakened  considerable  interest  in  the 
minds  of  many  insurance  leaders,  who  saw  in  the  movement  great 
possibilities  for  good  and  were,  therefore,  inclined  to  lend  active 
support  wherever  possible.  The  result  was  that  there  appeared 
before  the  World's  Insurance  Congress  men  who  enjo}^  national 
distinction  in  their  respective  fields. 


12        WORLD'S  INSURANCE  CONGRESS 


Permanent  Organization 

On  the  second  day  of  the  Confess  the  General  Chairman  an- 
nounced two  committees,  one  on  Resolutions  and  one  on  Permanent 
Organization. 

The  Committee  on  Resolutions  was  headed  by  Robert  Lynn  Cox, 
General  Counsel  and  Manager  of  the  Association  of  Life  Insurance 
Presidents,  who  was  assisted  by  C.  H.  Woodworth,  Louis  H.  Fibel, 
J.  B.  Levinson,  and  I.  I.  Boak,  and  the  Commissioner  and  Gen- 
eral Chairman  of  the  Congress  as  ex  officio  members. 

The  Committee  on  Permanent  Organization  was  headed  by 
Charles  H.  Holland,  General  Manager  of  the  Royal  Indemnity 
Company,  and  was  composed  of  Charles  W.  Scovel,  T.  L.  Miller, 
Franklin  H.  Wentworth,  William  G.  Wilson,  Dr.  Frederick  P. 
Hoffman,  C.  I.  Hitchcock,  William  J.  Dutton,  Bayard  P.  Holmes, 
Mark  T.  McKee,  Harry  P.  Coffin,  W.  E.  Straub,  C.  T.  Hughes, 
Willard  Done,  and  George  I.  Cochran,  together  with  all  members 
of  the  Resolutions  Committee,  and  the  Commissioner  and  Gen- 
eral Chairman  of  the  Congress  as  ex  officio  members. 

Both  committees  held  frequent  meetings  during  the  week  of 
the  Congress,  and  on  Saturday,  October  9th,  presented  their  re- 
ports to  a  meeting  of  the  assembled  members  of  the  National 
Council. 

The  proceedings  of  this  meeting  are  reported  in  detail  elsewhere 
in  this  work  (pages  55  f.  and  426  j^".). 

Pursuant  to  the  report  submitted  by  the  Committee  on  Per- 
manent Organization,  the  Executive  Committee  of  the  World's 
Insurance  Congress  appointed  a  Provisional  Central  Committee^ 
as  follows: 

Members  Representing 

Robert  Lynn  Cox    "] 

T.  L.  Miller  I  Life  interests. 

Charles  W.  Scovel    J 

Charles  H.  Holland] 

William  G.  Wilson  I    Casualty  and  surety  interests. 

Louis  H.  Fibel  J 

E.  G.  Richards         ^ 

C.  H.  Woodworth     V  Fire  interests. 

Rolla  V.  Watt  J 


J.  B.  Levinson 
Wm.  J.  Dutton 


r  ^Marine  interests. 


I.  L  Boak  1    -r.    ^        T  ^-  J 

W   F    Stni  b  -       raternal,  co-operative  and  non- 

Mark  T.  McKee        J        «^^^^  int^resi^- 


WORLD'S  INSURANCE  CONGRESS  13 

A  meeting  of  this  Committee,  held  on  the  same  day,  at  which 
all  were  present  with  the  exception  of  E.  G.  Richards,  J.  B.  Levin- 
son,  and  William  J.  Button,  resulted  in  the  selection  of  Charles 
H.  Holland  as  Chairman  and  Mark  T.  McKee  as  Secretary- 
Treasurer. 

This  is  the  permanent  organization  which  is  charged  with  the 
duty  of  carrying  out  the  purposes  for  which  the  World's  Insur- 
ance Congress  was  formed,  and  to  continue  the  activities  which 
have  been  so  auspiciously  begun. 


II 

ORDER  OF  BUSINESS  OF  THE  WORLD'S 
INSURANCE  CONGRESS 

OPENING  SESSION 

Civic  Auditorium  San  Francisco 

October  4th,  1915 

Call  to  Order;  Statement  of  Facts  and  Introduction  of 
General  Chairman 

W.  L.  Hathaway 
Commissioner   of   the   World's   Insurance    Congress 
Events  of  the  Panama-Pacific  International  Exposi- 
tion. 

Opening  Address  of  the  General  Chairman 
Hon.  Arthur  I.  Vorys 
Chairman  of  the  Committee  on  Insurance  Law  of  the 
American  Bar  Association 

Address  of  Welcome 

Chester  H.  Rowell 

For  the  Governor  of  the  State  of  California 

Address  op  Welcome 

Arthur  H.  Barendt 

For  the  Mayor  of  the  City  of  San  Francisco 

Response  to  Welcome 

Darwin  P.  Kingsley 

President  of  the  New  York  Life  Insurance  Company 

World's  Insurance  Congress  Movement:  Why  the 
Panama-Pacific  International  Exposition  has  given 
Prominent  Recognition  to  Insurance,  and  Wliat  it 
Hopes  the  Congress  Will  Accomplish 

Charles  C.  Moore 
President  of  the  Panama-Pacific  International  Expo- 
sition 

14 


WORLD'S  INSURANCE  CONGRESS  15 

Service  Performed  by  Insurance 

Hon.  J.  N.  Gillett 

Former   Governor  of  the   State   of  California,   who 

held  office  during  the  reconstruction  period  of  San 

Francisco 

SECOND  SESSION 
Civic  Auditorium  San  Francisco 

October  5th,  1915 
"constructive  influence  of  insurance" 

Hon.  Arthur  I.  Vorys,   General  Chairman 
Chairman,  Committee  on  Insurance  Law,  American 
Bar  Association,  and  ex-Insurance  Superintendent  of 
Ohio 

Hon.  Lawrence  Y.  Sherman,  Special  Chairman 
United  States  Senator  from  Illinois 

The  day  is  designed  to  bring  to  the  fore  the  part  that 
insurance  plays  in  conserving  and  bettering  citizenship 
through  the  prolongation  of  life,  the  cementing  of  family 
ties,  preventing  poverty,  the  upholding  of  law  and  order, 
maintaining  credit,  bettering  architectural  design  with 
safety,  preventing  fires,  accidents  and  casualties  of  all 
character,  improving  sanitation,  uplifting  the  individual 
in  the  eyes  of  himself  and  his  community,  and  ultimately 
acting  as  the  binder  which  draws  men  together  for  a  har- 
monious perpetuation  of  peaceful  pursuits  upon  a  con- 
structive basis. 

Each  speaker  is  expected  to  relate  the  part  his  class  of 
insurance  has  contributed  to  bring  about  these  conditions, 
and  finally  outline  the  basis  upon  which  it  can  best  con- 
tinue as  a  constructive  force,  frankly  admitting  its  com- 
mercial aspect  and  the  necessity  for  individual  initiative. 

Service  Performed  by  Fire  Insurance  Companies 

R.  W.  Osborn 
President,  Board  of  Fire  Underwriters  of  the  Pacific 

Service  Performed  by  Surety  Companies 

Frank  L.  Gilbert 
Vice  President,  National  Surety  Company 

Service  Performed  by  Life  Insurance  Companies 

Haley  Fiske 

Vice  President,  Metropolitan  Life  Insurance  Company 

(Paper  read  by  George  B.  Scott) 


16        WORLD'S  INSURANCE  CONGRESS 

Service  Performed  by  Life  Insurance  Companies 

T.  L.  Miller 
President,  West  Coast-San  Francisco  Life  Insurance 
Company 

Afternoon  Program 

Service  Performed  by  Casualty  and  Liability  Companies 
David  Van  Schaack 

Director,  Bureau  of  Inspection  and  Accident  Preven- 
tion, Aetna  Life  Insurance  Company;  Member  of 
Executive  Committee,  National  Safety  Council 

Service  Performed  by  Life  Insurance  Companies 

Charles  W.  Scovel 
Former  President,  National  Association  of  Life  Un- 
derwriters 

Service  Performed  by  Credit  Insurance  Companies 

E.  M.  Treat 

President,  American  Credit  Indemnity  Company 

Service  Performed  by  Marine  Insurance  Companies 

J.  B,  Levison 
Vice  President,  Fireman's  Fund  Insurance  Company 

The  Force  op  Insurance  in  Social  Economy 
Alvin  E.  Pope 
Chief  of  Education  and  Social  Economy,  Panama-Pa- 
cific International  Exposition 

THIRD  SESSION 
Civic  Auditorium  San  Francisco 

Octoler  6th,  1915 

"associations:  the  insurance  universities" 

Hon.  Arthur  I.  Vorys,  General  Chairman 
Chairman,  Committee  on  Insurance  Laws,  American 
Bar  Association,  and  ex-Insurance  Superintendent  of 
Ohio. 

Hon.  Willard  Done,  Special  Chairman 
Member,  Executive  Committee,  World's  Insurance  Congress 


WORLD'S  INSURANCE  CONGRESS  17 

Associations  represent  the  natural  avenues  through 
which  the  public  must  be  educated  iu  the  constructive  in- 
fluence of  insurance  as  developed  during-  the  proceedings 
of  the  second  day  of  the  Congress,  and  therefore  find 
their  logical  place  in  the  program  of  the  third  day. 

Each  speaker  is  expected  to  relate  the  part  that  the  asso- 
ciation Avith  which  he  is  identified  plays  in  the  ethics  and 
economics  of  Insurance,  and  to  outline  how  its  usefulness 
may  best  be  extended  so  as  to  bring  about  an  under- 
standing of  Insurance  and  its  service  among  the  greatest 
number  of  people,  to  the  end  that  there  will  be  fewer  bur- 
densome restrictions,  a  reduction  of  expenses  and  losses, 
lower  costs  to  the  consumer,  and  a  wider  distribution  of 
Insurance  benefits  to  the  people  at  large. 

American  Life  Convention 

Isaac  Miller  Hamilton 

President,  Federal  Life  Insurance  Company 

National  Fraternal  Congress  of  America 
I.  I.  Boak 
Member  of  Executive  Committee ;  Head  Consul  Pa- 
cific Division,  Woodmen  of  the  World 

National  Association  of  Insurance  Agents 
C.  H.  Woodworth 
Former  President 

National  Association  of  Life  Underwriters 

H.  H.  Ward 

Former  President 

International   Association  of   Casualty  and   Surety 
Underwriters 

E.  W.  De  Leon 
President,   Casualty  Company  of  America 

Afternoon  Program 

Nation.vl  Fire  Protection  Association 

Franklin  H,  Wentworth 

Secretary 

Association  of  Life  Insurance  Presidents 

Charles  A.  Peabody 

President,  IMutual  Life  Insurance  Company  of  New  York 

(Paper  read  by  Willard  Done) 


18        WORLD'S  INSURANCE  CONGRESS 

National  Council  of  Insurance  Federation  Executives 

IMark  T.  McKee 

Secretary  and  Treasurer 

National  Association  of  Casualty  and  Surety  Agents 

William  G.  Wilson 

Manager,  Aetna  Life  Insurance  Company 

Association  of  Life  Insurance  Medical  Directors 
Dr.  W.  W.  Beckett 
Medical  Director,  Pacific  Mutual  Life  Insurance  Com- 
pany 

National  Association  op  Mutual  Insurance  Companies 

J.  C.  Adderly 

Secretary,  Millers  Mutual  Casualty  Company 


FOURTH    SESSION 

Civic  Auditorium  San  Francisco 

October  7th,  1915 

"broadening  social  economy  through  insurance" 

Hon.  Arthur  I.  Vorys,  General  Chairman 
Chairman,  Committee  on  Insurance  Law,  American 
Bar  Association,  and  ex-Insurance  Superintendent  of 
Ohio 

Robert  Newton  Lynch,   Special  Chairman 
Vice  President,  San  Francisco  Chamber  of  Commerce 

The  program  of  the  preceding  days  having  shown  the 
functions  commercially  performed  by  Insurance  and  its 
broad  social  service — economic,  educational  and  ethical — 
it  logically  follows  that  the  fourth  day  should  be  devoted 
to  showing  how  widely  the  principles  involved  in  the  in- 
surance idea  have  extended  to  the  prevention  of  fire,  acci- 
dent and  disease  in  other  great  organized  forces  of  busi- 
ness and  society,  thus  accomplishing  a  humanitarian  work 
through  the  commercial  considerations  that  prompted  it. 

Each  speaker  is  expected  to  define  the  extent  to  which 
prevention  and  conserA'ation  have  entered  into  the  work 
of  the  institution  with  which  he  is  identified  and  to  outline 
the  benefits  accrued  to  the  organization  itself,  to  the  indi- 
viduals associated  with  it,  and  society  which  it  serves. 


WORLD'S  INSURANCE  CONGRESS  19 

Southern  Pacific  Compaisty 

E.  0.  McCormick 

Vice  President 

Life  Extension  Institute,  Inc. 

E,   E.   Rittenhouse 

President 

United  States  Bureau  of  Mines 

Dr.  F.  G.  Cottrell 

Chief  Chemist 

A  Prominent  Department  Store 

Arthur  Hawxhurst 

Insurance  Manager,  Marshall  Field  &  Company 

Safety  First  Federation  of  America 

Harry  P.  Coffin 

Chairman,  Public  Safety  Commission,  Portland,  Ore. 

Afternoon  Program 

National  Association  of  Credit  IVIen 

C.  E.  Baen 

Assistant  Manager,  International  Banking  Corporation 

American  Bar  Association 

Arthur  I.  Vorys 

Chairman,   Committee   on   Insurance  Law 

American  Institute  op  Banking 
James  K.  Lynch 
Vice-President,  First  National  Bank,  San  Francisco; 
President,  American  Bankers'  Association 

American  Institute  of  Architects 

R.  Clipston  Sturgis 

President 

American  Institute  of  Electrical  Engineers 

John  A.  Britton 

President,  Pacific  Gas  and  Electric  Company 


20  AYORLD'S  INSURANCE  CONGRESS 

FIFTH  SESSION 

Civic  Auditorium  San  Francisco 

October  8th,  1915 

"present  problem  and  future  contingencies" 

Hon.  Arthur  I.  Vorys,  General  Chairman 
Chairman,  Committee  on  Insurance  Law,  American 
Bar  Association,  and  ex-Insurance  Superintendent  of 
Ohio 

]\I.  H.  DeYoung,  Special  Chairman 
Proprietor  and  Publisher,  San  Francisco  Chronicle, 
and  Vice  President  of  Panama-Pacific  International 
Exposition 

The  topics  set  for  the  fifth  day  come  as  a  natural  se- 
quence to  the  proceedings  of  the  foregoing  da3-s,  which 
have  dealt  with  the  constructive  influence  of  Insurance  in 
bettering  and  conserving  citizenship,  the  force  of  associ- 
ation work  in  the  development  of  an  understanding  of  its 
broad  principles  of  service,  and  the  application  of  these 
principles  to  the  great  organized  forces  of  business  and 
society.  Any  business  that  contributes  so  much  to  hu- 
manity at  large  should  be  encouraged  by  society  to  main- 
tain the  personal  initiative  which  can  only  be  developed 
through  commercial  independence,  unhampered  b}'  bur- 
densome restrictions  or  communistic  experiments. 

Present  Problems 

The  Relation  op  Fire  Insurance  to  the  Exposition 

"William  Sexton 
Former  General  Adjuster,  Fireman's  Fund  Insurance 
Company 

Taxation  of  Insurance  Companies  for  Revenue 

F.  Robertson  Jones 

Secretary,  Workmen's  Compensation  Publicity  Bureau 

State  Supera^sion 

T.  W.  Blackburn 

Secretary  and  Counsel,  American  Life  Convention 

Taxation  for  Revenue 

Edward  A.  Woods 

President,  National  Association  of  Life  Underwriters 

(Paper  presented  by  F.  E.  ^Ic^Mullen) 


WORLD'S  INSURANCE  CONGRESS  21 

Future  Contingencies 

National  Supervision 

George  W.  Miller 

President,  National  Fraternal  Congress  of  America 

(Paper  presented  by  I.  I.  Boak) 

National  Supervision 

Samuel  Davis 
Member  of  Boston  Bar 

National  Supervision 

Charles  F.  Coffin 

Vice  President,  State  Life  Insurance  Company 

Governmental   Obstacles  to  Insurance 

David  Starr  Jordan 

Chancellor,  Leland  Stanford,  Junior,  University 

SIXTH    SESSION 

Palace  Hotel  San  Francisco 

October  9th,  1915 

meeting  op  the  national  council 

Hon.  Arthur  I.  Vorys,  General  Chairman 
Chainnan,  Committee  on  Insurance  Laws,  American 
Bar  Association,  and  ex-Insurance  Superintendent  of 
Ohio. 

Robert  Lynn  Cox,  Special  Chairman 
General     Counsel,    Association    of    Life    Insurance 
Presidents 

Call  to  Order 
Arthur  I.  Vorys 
General  Chairman 

Report  of  the  Resolutions  Committee 
Robert  Lynn  Cox 
Special  Chairman 

Report  of  the  Committee  on  Permanent  Organization 
Charles  H.  Holland 


22        WORLD'S  INSURANCE  CONGRESS 

Address 
Arthur  I.  Vorys 
General  Chairman 

SEVENTH  SESSION 

Festival  Hall,  P.P.I.E.  San  Francisco 

October  11th,  1915 

world's  insurance  congress  peace  day 

Dr.  David  Starr  Jordan,  Special  Chairman 
Chancellor,  Leland  Stanford,  Junior,  Uni- 
versity 

Rolla  V.  Watt,  Chairman  of  Morning  Session 
Manager,  Royal  and  Queen  Insurance  Companies 

Realization  of  insurance  as  function  which  binds  society 
together,  giving  security  and  basis  for  personal  initiative, 
so  war  is  a  form  of  savagery  opposed  to  social  unity,  se- 
curity, personal  initiatve  and  all  forms  of  progress.  Real- 
ization that  war  is  directly  opposed  to  industry  and  in- 
surance. War  kills  off  the  most  efficient  part  of  the  com- 
munity. Underwriters  of  world  should  form  compact 
nucleus  of  organization  to  promote  and  maintain  security 
and  stability  in  international  affairs. 

Committee 

Dr.  David  Starr  Jordan  John  Barrett  Senator  T.  E.  Burton 

Andrew  Carnegie  Ida  M.  Tarbell  Henry  B.  Hawley 

Jane  Addams  Dr.  Jas.  A.  Macdonald  Prof.  E.  B.  Krehbiel 

Darwin  P.  Kingsley        Prof.  Josiah  Royce        Prof.  Ira  W.  Howeth 
Oscar  L.  Straus  John  Caster  Branner    W.  P.  Foster 

Wm.  Jennings  Bryan      Ernest  Fox  Nichols     Dr.  Norman  Bridge 

Address 

Rolla  V.  Watt 

Manager,  Royal  and  Queen  Insurance  Companies 

International  Insurance 
Prof.  Josiah  Royce 
Harvard  University 

War,  Business  and  Insurance 

David  Starr  Jordan 

Chancellor,   Leland   Stanford,   Junior,   University 


WORLD'S  INSURANCE  CONGRESS  23 

EIGHTH  SESSION 

Fountain  of  Energy,  P.P.I.E.  San  Francisco 

October  12th,  1915 

world's  insurance  congress  life  conservation  day 

E.  E.  Rittenhouse,  Special  Chairman 
President,  Life  Extension  Institute 

Education  of  the  public  is  now  recognized  as  an  indis- 
pensable part  of  any  campaign  for  the  promotion  of  health 
— the  prolongation  of  life. 

Life  Conservation  Day  Parade 

Address;  Presentation  op  Med.vl  to  Life  Extension  Institute 

W.  L.  Hathaway 
Commissioner,  World's  Insurance  Congress  Events 

Acceptance  of  Medal;  Address 

E.  E.  Rittenhouse 

President,   Life   Extension  Institute 

Presentation  of  Exposition  Scroll  to  Alvin  E.  Pope 

Willard  Done 

Member,  Executive  Committee,  World's  Insurance  Congress 

Presentation  of  Lo\aNG  Cup  to  Alvin  E.  Pope 

R.  W.  Osborn 

President,  Board  of  Fire  Underwriters  of  the  Pacific 

Acceptance  of  Scroll  and  Cup 

Alvin  E.  Pope 

Chief,  Department  of  Education  and  Social  Economy,  P.P.I.E, 

Insurance  and  the  Conservation  of  Human  Life 

Dr.  Frederick  L.  Hoffman 

Statistician,  The  Prudential  Insurance  Company  of  America 

Human  Life  as  a  National  Asset 
Dr.  C.  C.  Pierce 
Senior  Surgeon,  U.  S.  Public  Health  Service 


24        WORLD'S  INSURANCE  CONGRESS 

What  the  Panama-Pacific  International  Exposition  is  Doing 

FOR  THE  Cause  op  Life  Conservation 

Alvin  E.  Pope 

Chief,   Department  of  Educcation  and   Social  Economy,  P.P.I.E. 

Life  Conservation  and  ^Medicine 

Dr.  Harry  M.  Sherman 

President,    California  Association   for   Study  and  Prevention   of 

Tuberculosis 

Life  Conservation  and  Social  Economy 

Miles  M.  Dawson 

Consulting  Actuary 


NINTH  SESSION 
Court  of  the  Universe,  P.P.I.E.  San  Francisco 

October  13th.,  1915 
world's  insurance  congress  fire  elimination  day 

Franklin  H.  Wentworth,  Special  Chairman 
Secretary,  National  Fire  Protection  Association 

Willard  Done,  Chairman 

Member  of  the  Executive  Connnittee,  World's  Insurance 

Congress  Events 

It  is  widely  recognized  that  the  fire  loss  of  the  United 
States  is  one  of  the  Crimes  of  the  Nation.  Marked  prog- 
ress has  been  made  in  the  last  decade  for  the  prevention 
of  fire,  but  the  campaign  is  still  in  its  beginnings. 

Opening  Address 

AVillard  Done 

Chairman 

Address  and  Presentation  of  ]Medal  to  National  Fire 
Protection  Association 

AV.  L.  Hathaway 
Commissioner,  World's  Insurance  Congress  Events 

Acceptance  of  Medal  and  Address 

Franklin  H.  Wentworth 

Secretary,  National  Fire  Protection  Association 


WORLD'S  INSURANCE  CONGRESS  25 

Presentation  of  Medal  to  Fire  Patrol 

W.  L.  Hathaway 

Commissioner,  World's  Insurance  Congress  Events 

Acceptance  of  Medal 

R.  W.  Osborn 

President,  Board  of  Fire  Underwriters,  of  the  Pacific 

Demonstration  op  ]\Iarina 


TENTH  SESSION 

Court  of  the  Universe,  P.P.I. E.  San  Francisco 

October  14th,  1915 

v^orld's  insurance  congress 
' '  safety  first ' ' :  accident  prevention  day 

E.  0.  ]\IcCormick,  Special  Chairman 
Vice-President,  Southern  Pacific  Railway- 
Accident  prevention  has  gained  a  wide  impetus  in  the 
United  States  and  is  gaining  in  public  interest  and  effi- 
ciency with  every  passing  year. 

Opening  Address 
E.  0.  McCormick 
Special  Chairman 

Address  and  Presentation  of  JMedal  to  Workmen's 
Compensation  Service  Bureau 

Willard  Done 

Member  of  the  Executive  Committee,  World's  Insurance 

Congress  Events 

Acceptance  of  IMedal  :  Address — Safety  Work  of  Insurance 

Companies 

Charles  H.  Holland 
General  Manager,  Royal  Indemnity  Company 

Safety  Work  of  Railroads 

L.  E.  Abbott 

General  Claim  Agent,  Oregon  Short  Line  Railroad 


26        WORLD'S  INSURANCE  CONGRESS 

Industrial  Safety 

Will  J.  French 

Director  of  the  National  Safety  Council 

Safety  First  from  a  Street  Traffic  Standpoint 

Lieut.  Duncan  Matheson 

San  Francisco  Police  Department 

Demonstration  on  jNIarina 


Ill 

PROCEEDINGS  OF  THE  WORLD'S  INSURANCE 

CONGRESS 

MONDAY,  OCTOBER  4TH,  1915 

opening  day 

Call  to  Order;  Statement  of  Facts  and  Introduction  op  the 
General  Chairman 

By  W.  L.  Hathaway 

Commissioner  of  the  World's  Insurance  Congress  Events  of  the 

Panama-Pacific  International  Exposition 

"Before  introducing  to  you  the  General  Chairman,  who  will 
conduct  these  meetings,  a  brief  statement  of  facts,  showing  the 
purposes  aimed  at  and  the  work  that  has  been  accomplished  by 
this  Commission  to  carry  them  out,  would  seem  to  be  appropriate. 

"In  November,  1910,  eighty-two  leaders  in  all  lines  of  California 
insurance  endeavor  met  and  resolved  to  hold  this  Congress.  That 
was  the  first  meeting  in  history  where  leaders  from  all  branches 
of  insurance  were  brought  together  for  a  common  purpose.  In 
many  instances  they  were  strangers  to  each  other,  although  resid- 
ing in  the  same  city  and  occupying  positions  of  relative  importance 
in  different  branches  of  a  business  whose  public  service  is  in  all 
ways  closely  related.' 

"The  meeting  resulted  in  a  set  of  resolutions  citing  the  advan- 
tages of  closer  relationship,  and  inviting  the  leaders  from  the 
world  of  insurance  together  here  for  this  Congress  to  establish  per- 
manently such  relationship  on  a  world-wide  basis,  under  conditions 
best  expressed  by  the  paragraph  on  the  letter-head  that  day 
authorized  to  be  printed,  which  read: 

"  'The  Panama-Pacific  World's  Insurance  Congress,  San  Fran- 
cisco, 1915,  invites  all  associations  or  societies,  either  of  a  business 
or  professional  nature,  whose  membership  derive  their  livelihood 
from  the  commerce  of  insurance,  to  hold  their  conventions  or 
meetings  in  the  City  of  San  Francisco  in  the  year  1915,  when  a 
World 's  Congress  of  Insurance  interests  will  be  held  separate  and 
apart  from  the  regular  annual  proceedings  of  the  various  associ- 
ations or  societies.' 

"The  Chairman  appointed  at  that  meeting  proceeded  to  issue 
the  invitation  by  mailing  during  the  next  three  months  to  leading 

27 


28        WORLD'S  INSURANCE  CONGRESS 

insurance  men  throughout  the  world  32,000  personally  directed 
and  signed  letters  of  invitation  for  suggestions  and  cooperation. 

"The  number  and  character  of  the  replies  confirmed  and  en- 
couraged the  purposes  aimed  at,  which  were  also  accepted  with 
unanimously  favorable  comment  by  the  insurance  press  throughout 
the  world. 

"About  this  time,  as  the  Panama-Pacific  International  Exposition 
was  assuming  definite  organization  to  appear  before  the  world  as 
its  greatest  university  to  educate  the  public  in  the  service  of  those 
arts  and  industries  which  contribute  most  to  the  comfort,  happi- 
ness and  prosperity  of  the  human  race,  a  petiton  was  presented 
to  the  President  of  the  Exposition  signed  by  the  eighty-two  original 
organizers,  requesting  that  the  movement  be  made  a  part  of  the 
official  Exposition  life,  and  pledging  their  unanimous  and  con- 
tinued support  for  its  ultimate  success.  The  easiest  task  that  the 
original  promoter  has  had  in  the  five  years'  work  was  convincing 
the  Exposition  President  that  the  constructive  influence  of  insur- 
ance deserved  the  same  recognition  that  had  always  been  accorded 
by  similar  undertakings  to  all  other  human  activities  beneficial  to 
society.  Through  the  creation  of  this  Commission,  a  business  that 
had  become  one  of  the  world's  chief  activities,  especially  in  this 
nation,  contributing  more  to  the  social  uplift  than  perhaps  any 
other,  acquired  collectively  for  the  first  time  in  its  history  a  leader 
to  encourage  a  better  public  understanding  of  its  real  functions, 
in  the  person  of  Mr.  Charles  C.  Moore,  President  of  this  Exposi- 
tion ;  and  the  mighty  influence  of  the  Exposition  under  his  leader- 
ship has  carried  the  movement  forward. 

"In  the  next  year  most  of  the  foreign  consuls  located  at  San 
Francisco  made  extensive  and  favorable  mention  of  the  Congress 
and  its  aims  in  the  reports  to  their  various  governments,  which  re- 
sulted in  favorable  mention  in  the  trade  journals  and  the  general 
press  in  the  various  countries,  until  in  June,  1913,  the  International 
Bureau  of  Insurance  (which  included  practically  all  of  the  Euro- 
pean insurance  organizations)  at  a  meeting  in  Paris  passed  unani- 
mous resolutions  to  hold  its  1915  meeting  in  connection  with  this 
Congress  in  San  Francisco,  and  recommended  to  all  of  the  associ- 
ations making  up  its  membership  that  they  do  likewise.  From  that 
time  comments  in  the  European  insurance  press  were  as  favorable 
as  those  in  the  American  press,  and  were  it  not  for  the  present 
unfortunate  world  condition  this  meeting  would  be  the  most  power- 
ful that  has  ever  gathered  for  peaceful  purposes.  As  it  is,  we  have 
thirteen  foreign  nations  represented,  which,  while  small,  never- 
theless gives  it  the  international  caste  aimed  at. 

"The  wars  in  Europe  gave  us  our  problems.  Some  advised 
abandonment  of  the  undertaking,  but  those  who  had  studied  it 
most  closely  believed  that  the  movement  had  a  purpose  that  would 
prevail  and  succeed  regardless  of  the  mere  number  of  representa- 
tives that  might  gather  on  this  occasion. 

"Nationally,  it  has  been  a  success  far  beyond  the  scope  of  its 


WORLD'S  INSURANCE  CONGRESS  29 

original  purpose,  stated  above.  It  aimed  to  bring  together  at  one 
time  for  this  meeting  all  who  were  to  participate,  but  under 
Exposition  auspices  the  movement  broadened  and  became  known 
as  the  World's  Insurance  Congress  Events.  The  first  gathering 
was  held  as  a  pre-opening  Exposition  event,  when  on  April  18th, 
1914,  it  was  given  to  Insurance  under  this  Commission  to  dedicate 
Machinery  Hall,  the  first  completed  building  of  the  Exposition, 
when  14,000  local  people  assembled  for  an  occasion  that  has  be- 
come history.  On  that  occasion  San  Francisco  itself  was  claimed 
by  Insurance  men  as  Exhibit  A  in  the  great  Exposition,  for  the 
reason  that  insurance  made  it  possible. 

"Then,  in  April  of  1915,  insurance  Avas  given  the  honor  of  the 
official  Exposition  and  Citj^  'Nine  Years  After  Event,'  which  for 
several  days  gathered  record  crowds,  beginning  with  Saturday, 
April  17th,  when  the  greatest  parade  in  the  Exposition's  history 
passed  through  the  gates  under  the  leadership  of  insurance,  pro- 
claiming to  the  world  its  constructive  influence.  On  April  18th 
the  leaders  in  religion  and  education  of  this  State  spoke  from  one 
platform  in  the  Court  of  the  Universe,  and  avowed  that  through 
the  agency  of  insurance  the  commercial  instincts  of  man  were 
being  used  by  a  greater  power  than  theirs  for  the  uplift  of 
humanit}^ 

' '  Since  then  there  has  been  an  almost  continuous  series  of  insur- 
ance conventions  and  meetings  in  this  city,  until  at  this  time  we 
have  entertained  more  than  one  hundred  thousand  directly  engaged 
in  some  line  of  your  business  or  allied  activity.  If  all  of  those  who 
have  been  here,  together  with  their  natural  following  of  families 
and  friends,  had  come  at  one  time,  we  could  not  have  looked  out 
for  them,  and  if  the  European  participation  had  materialized  upon 
the  basis  which  their  interest  previous  to  the  wars  made  it  reason- 
able to  expect,  we  would  have  been  completley  swamped. 

"The  events  were  all  educational.  The  commercial  element  of 
the  business  has  been  kept  in  the  background.  They  have  ex- 
ploited the  side  of  your  business  that  the  public  ought  to  know — 
its  Social  Service. 

"It  is  variously  estimated,  from  the  information  in  our  hands, 
that  there  will  be  here  during  this  week  from  six  to  eight  thou- 
sand insurance  men.  We  know  the  attractions  of  the  Exposition 
and  the  City  will  make  it  difficult  to  get  you  all  together  at  one 
time,  but  the  organization  is  of  such  a  character  that  the  big  pur- 
poses aimed  at  will  nevertheless  go  forward. 

' '  The  last  two  pages  of  the  program,  if  you  will  note,  recite  the 
existence  of  a  National  Council.  These  are  the  representatives  of 
115  American  insurance  and  allied  associations,  many  of  them 
national  in  their  scope.  These  associations  have  by  resolution  en- 
dorsed this  Congress.  Their  delegates  are  here  to  listen  to  these 
deliberations  and  finally,  as  an  organization,  to  determine  its 
findings.  Upon  these  gentlemen  rests  a  deep  responsibility.  The 
Exposition  has  started  a  great  public  educational  movement  as  to 


30        WORLD'S  INSURANCE  CONGRESS 

the  real  functions  and  services  which  you  individuals,  your  compa- 
nies, and  your  societies,  perform.  Whether  or  not  the  movement 
will  go  forward  as  an  educational  campaign  for  the  good  you  are 
doing  in  the  world  depends  upon  you.  When  these  meetings 
close,  the  greatest  Exposition  in  the  world  will  have  done  its  part 
for  a  business  that  performs  a  service  little  understood  by  the' 
public.  This  service  will  go  on.  In  time  the  public  will  come 
to  understand  it  better,  and  look  more  kindly  upon  it  and  the  men 
engaged  in  it.  The  time,  however,  depends  upon  you.  The  Expo- 
sition has  played  its  part.  It  has  made  an  epoch  in  insurance 
history. 

"I  do  predict,  however,  that  the  public  in  time  will  judge  the 
men  engaged  in  the  business  by  the  extent  to  which  they  grasp 
this  opportunity  of  carrying  forward  the  work  of  clarifying  the 
public  mind  as  to  the  broad  social  functions  of  your  commercial 
activities. 

''I  noAv  have  the  honor  of  introducing  to  you  a  man  who  is  so 
well  known  nationally  for  his  broad  understanding  of  insurance 
subjects,  as  well  as  for  his  many  other  attainments,  that  a  lengthy 
introduction  from  me  would  be  superfluous.  He  is  Chairman  of 
the  Committee  on  Insurance  Law  of  the  American  Bar  Associa- 
tion. From  this  time  he  will  have  charge  of  these  meetings  as 
General  Chairman— the  Honorable  Arthur  I.  Vorys,  of  Columbus, 
Ohio." 

[The  address  of  Mr.  Vonjs  will  he  found  on  page  72.] 

General  Chairman  Introducing  Chester  H.  Rowell 

"The  Governor  of  this  great  State,  because  of  his  unavoidable 
absence  here  to-day,  has  delegated  a  fit  representative  to  convey 
to  us  the  sentiments  of  the  great  State  of  California  and  its  people 
respecting  this  organization,  these  people,  this  World's  Insurance 
Congress.  A  student  in  sociology,  a  man  of  national  reputation, 
insurance  has  not  been  neglected  by  him :  the  editor  and  manager 
of  a  great  inland  paper,  and  a  Commissioner  of  the  Exposition, 
I  take  great  pleasure  in  introducing  to  you  IMr.  Chester  H.  Rowell 
of  Fresno." 

[The  address  of  Mr.  Rowell  mil  he  found  on  page  73.] 

General  Chairman  on   Conclusion  of  Mr.  Rowell 's  Address 

"Mr.  Rowell  is  a  man  who  can  be  described  by  that  trite  old 
saying,  'He  is  a  man  who  has  the  courage  of  his  convictions'.  He 
has  spoken  to  us  with  frankness,  and  he  has  given  us  a  view  into 
the  future  of  insurance  which  no  doubt  all  of  you  who  are  en- 
gaged in  the  business  hope  may  some  day  be  realized." 


WORLD'S  INSURANCE  CONGRESS  31 

General  Chairman  Introducing  Arthur  H.  Barendt 

"When  I  came  into  this  city  a  week  ago,  I  saw  in  many  places 
banners  saying  'Elect  Rolph  at  the  Primaries'.  I  wondered  what 
that  meant,  and  it  wasn't  until  I  had  made  some  inquiry  that  I 
found  you  had  a  kind  of  primary  here  in  San  Francisco  which 
provided  for  political  nominations,  and  also  provided  that  if  a 
candidate  got  more  votes  than  all  of  the  rest  put  together,  he  was 
then  elected,  and  as  the  result  of  that  primary  INIayor  James  Rolph 
was  so  endorsed  by  the  voters  of  this  City  that  he  was  re-elected 
for  another  four-j^ear  term.  In  expressing  our  regret  that  the 
Mayor  cannot  be  here  with  us  to-day,  I  am  also  expressing  his 
very  sincere  regret,  but  he  has  delegated  a  gentleman  to  take  his 
place  who  is  well  qualified  to  speak  the  feeling  of  the  City  of  San 
Francisco  toward  those  assembled  here — Mr.  Arthur  H.  Barendt." 

[The  address  of  Mr.  Barendt  ivill  he  found  on  page  75,] 

General  Chairman  Introducing  Darwin  P.  Kingsley 

"To  respond  to  the  gracious  words  of  welcome  on  behalf  of 
the  State  and  City,  I  will  introduce  to  you  a  gentleman  of  whom 
the  institution  of  insurance  may  well  be  proud.  He  has  had  to 
do  with  it  in  several  different  capacities.  He  has  had  experience 
as  an  official  in  supervising  the  conduct  of  insurance  on  behalf 
of  one  of  our  States.  He  has  been  through  the  vicissitudes  of  life 
insurance  when  life  insurance  was  on  the  rack.  He  has  come  out 
of  it  personally  unscathed.  He  is  the  president  of  a  life  insur- 
ance compan}^  mutual  in  its  organization,  mutual  in  fact — so  large 
that  it  is  now  recognized  as  a  quasi-public  institution,  so  large 
that  he  at  the  head  of  it  regards  it  as  a  public  trust,  and  himself 
a  public  functionary.  It  gives  me  great  pleasure  to  introduce  to 
you  Mr.  Darwin  P.  Kingsley,  President  of  the  New  York  Life 
Insurance  Company." 

[The  address  of  Mr.  Kingsley  will  he  found  on  page  77.] 

General  Chairman  on  Conclusion  op  Mr.  Kingsley 's  Address 

' '  There  is  no  doubt  in  listening  to  this  profound  and  remarkable 
address  of  Mr.  Kingsley — so  pregnant  with  deep  thought — that  we 
here  have  been  impressed  with  what  we  have  been  thinking  about 
for  a  long  time,  the  duty  of  this  Nation,  a  wider  and  greater  duty 
of  every  individual  in  this  Nation,  a  duty  that  makes  us  face  the 
whole  world  as  a  human  family,  a  duty  to  in  some  way  accomplish 
the  design  of  the  Master,  and  bring  about  the  Brotherhood  of 
Man,   the  Fatherhood   of  God." 

General  Chairman  Introducing  Charles  C.  Moore 

"We  see  here  in  this  City,  on  this  Pacific  Coast,  the  most  mag- 
nificent  spectacle   that   human    eyes   have   witnessed — this   great 


32        WORLD'S  INSURANCE  CONGRESS 

Panama-Pacilic  International  Exposition.  "We  had  heard  about 
it;  but  when  we  see  it  in  the  sunlight,  and  when  we  see  it  in  the 
limelight,  we  marvel  as  we  never  did  before.  We  marvel  at  the 
genius  of  those  who  produced  it ;  we  marvel  more  when  we  think 
of  the  circumstances,  the  obstacles  which  they  surmounted,  in 
bringing  about  this  great  Exposition.  AVe  marvel  when  we  see 
how  it  has  provided  for  the  convenient  accommodation  of  the 
people.  Why,  it  is  like  Sunday  out  there.  The  quiet  crowds,  mov- 
ing about,  transported  from  place  to  place — every  one  having  an 
opportunity  to  witness  every  feature  of  this  remarkable  spectacle. 

"We  are  fortunate  to-day  in  having  with  us  the  President  of 
that  Exposition.  We  have  been  fortunate,  and  hundreds  of  thou- 
sands of  people  engaged  in  the  business  or  affected  directly  or 
otherwise  by  insurance,  have  been  fortunate  that  the  President  of 
this  Exposition  was  inspired  with  a  notion  that  insurance  should 
form  a  conspicuous  part  in  this  great  Exposition.  He  will  now 
address  us,  and  state  why  the  Panama-Pacific  International  Ex- 
position has  given  prominent  recognition  to  insurance,  and  what 
it  hopes  the  Congress  will  accomplish. 

"I  have  the  distinguished  honor  of  introducing  to  you  Charles 
C.  Moore,  the  President  of  the  Panama-Pacific  International 
Exposition." 

[The  address  of  Mr.  Moore  icill  he  found  on  page  83.] 

General  Chairman  on  Conclusion  of  Mr.  Moore's  Address 

"I  know  we  all  appreciate,  among  other  things  said  by  Mr. 
Moore,  the  tone  and  spirit  of  welcome — the  emphasis  that  he  places 
upon  the  institution  of  Insurance.  Sometimes  we  have  to  go 
away  from  home  to  learn  about  our  own  city.  Sometimes  we  have 
to  go  away  from  our  own  business  and  get  ideas  about  it,  for  I 
think  you  who  are  here  and  who  are  engaged  in  the  business  of 
insurance  have  found  in  what  has  been  said  by  ]\Ir.  INIoore  a  most 
perfect  and  advanced  conception  of  your  business  of  insurance." 

General  Chairman  Introducing  J.  N.  Gillett 

"The  program  this  afternoon  will  be  concluded  by  one  who  for 
years  has  been  a  friend  of  insurance.  He  has  been  a  legislator 
in  the  legislative  assembly  of  California,  he  has  been  a  member 
of  the  National  Congress,  and  he  was  Governor  of  the  State  of 
California  during  the  reconstruction  period.  He  will  address  us 
on  the  subject  of  the  service  performed  by  insurance,  and  I  take 
pleasure  in  introducing  to  you  former  Governor  J.  N.  Gillett." 

[The  address  of  Mr.  Gillett  u'ill  he  found  on  page  86.] 

General  Chairman  on  Conclusion  op  ]\Ir.   Gillett 's  Address 

"It  is  a  long  way  from  Columbus.  Ohio,  to  San  Francisco,  but 
I  think  that  speech  was  worth  the  trip." 


WORLD'S  INSURANCE  CONGRESS        33 

Closing  Address  of  the  General  Chairman 

"The  American  Life  Convention,  which  needs  no  description,  I 
apprehend,  in  this  body — an  important  organization  of  life  in- 
surance companies,  has  been  holding  its  annual  convention  this 
last  week  at  Del  Monte,  and  at  four  o  'clock  there  will  be  ceremonies 
in  the  Court  of  Abundance  on  the  Exposition  Grounds  commemo- 
rative of  the  services  of  the  American  Life  Convention,  including 
the  presentation  of  a  medal  of  honor.  Automobiles  are  here  in 
front  of  the  building  to  take  the  members  of  the  Convention  and 
their  friends  out  to  the  Exposition  Grounds.  The  ceremonies 
there  will  be  at  four  o'clock. 

"Now  the  Congress  will  convene  to-morrow  morning  at  ten 
o'clock  in  the  adjoining  hall.  Honorable  Lawrence  Y.  Sherman, 
United  States  Senator  from  Illinois,  whom  you  all  know,  who  has 
a  wide  reputation,  and  who  has  given  considerable  attention  to 
the  subject  which  is  interesting  yourselves  now,  will  be  the  Special 
Chairman  to-morrow. 

"I  also  wish  to  say  that  on  to-morrow  important  committees 
of  the  Congress  will  be  announced. 

"I  trust  that  you  all  feel,  as  I  certainly  do,  that  this  has  been 
a  most  auspicious  opening  of  what  I  hope  to  be  not  only  the 
World's  Insurance  Congress  of  1915,  but  a  permanent  organiza- 
tion for  educational  purposes  that  will  exist  in  this  country  for- 
ever. ' ' 

E7id  of  the  First  Day's  Proceedings. 


TUESDAY,  OCTOBER  5TH,  1915 

"constructive  influence  of  insurance" 

Opening  Address  of  the  General  Chairman, 
Arthur  I.  Vorys 

"I  wish  to  announce  this  morning  the  appointment  of  several 
committees,  anticipating  some  concrete  results  of  this  Congress., 
The  organization  (I  will  read  it  as  it  is  published  on  the  printed 
program)  'consists  of  a  Commission  of  the  Panama-Pacific  Inter- 
national Exposition,  composed  of  a  Commissioner,  a  Deputy  Com- 
missioner, an  Executive  Committee  of  five  and  a  National  Council 
created  at  the  request  of  the  above  Commission  by  each  of  the  fol- 
lowing associations  having  delegated  the  respective  member  to 
represent  them  in  the  deliberations  and  findings  of  this  Con.frress. ' 
and  following  that  is  the  list  of  the  respective  organizations  wlio 
have  selected  delegates  to  the  Congress.  I  desire  to  announce  the 
appointment  of  a  Committee  on  Resolutions  of  five  members  of 
the  National  Council  as  follows:  Robert  Lynn  Cox,  Chairman, 
C.  H.  Woodworth,  Louis  H.  Fibel,  J.  B.  Levisn  and  I.  I.  Boak; 
and  a  Committee  on  Permanent  Organization  as  follows:    Charles 


34        WORLD'S  INSURANCE  CONGRESS 

H.  Holland,  Chairman,  Charles  W.  Scovel,  T.  L.  Miller,  Franklin 
H.  Wentworth,  William  G.  Wilson,  Dr.  Frederick  P.  Hoffman, 
C.  I.  Hitchcock,  William  J.  Dutton,  Bayard  P.  Holmes,  Mark  T. 
McKee,  Harry  P.  Coffin,  W.  E.  Straub,  C.  T.  Hughes,  Willard 
Done  and  George  I.  Cochran.  In  addition  to  those  fifteen  mem- 
bers of  the  Committee  on  Organization  the  five  members  of  the 
Committee  on  Resolutions  will,  ex  officio,  be  members  of  the  Com- 
mittee on  Permanent  Organization.  Mr.  Garner  Curran,  the 
Deputy  Commissioner  of  the  World's  Insurance  Congress,  will  act 
as  Secretary  of  both  of  these  committees." 

Charles  W.  Sco\^l  Speaking  From  Floor 

"Mr.  Chairman:  It  occurs  to  me  that  if  this  body  were  working 
under  a  written  charter  it  would  provide  as  a  matter  of  course 
that  the  executive  would  be  a  member  of  all  committees.  We  have 
no  constitution  or  charter,  but  we  atone  for  that  by  having  two 
executives — the  general  executive  of  the  World's  Fair  Commission 
and  our  General  Chairman.  It  seems  quite  obvious  that — not  to 
honor  them,  but  because  the  committees  need  their  services,  they 
should  be  ex  officio  members  of  these  two  committees,  and  I  there- 
fore move,  and  put  the  question,  to  spare  the  Chairman  embarrass- 
ment, that  the  Chairman  and  the  Commissioner  be  ex  officio  mem- 
bers of  those  committees.     Do  I  hear  a  second?" 

{The  motion  was  seconded  from  the  floor  and  mmnimously 
carried. ) 

Acknowledgment  of  Arthur  I.  Vorys 

"Gentlemen:  On  behalf  of  Mr.  Hathaway  I  desire  to  thank  you; 
and  also  on  behalf  of  myself." 

General  Chairman  Introducing  Lawrence  Y,  Sherman 

"Yesterday  was  an  auspicious  opening  of  this  World's  Insur- 
ance Congress.  I  know  from  the  rapt  attention  those  who  were 
here  gave  to  the  several  addresses,  and  from  the  expressions  I  heard 
from  them  afterwards,  how  profoundly  they  were  all  impressed 
by  the  several  speakers  whom  we  had  the  privilege  of  hearing 
yesterday.  Insurance  as  a  social  instrument  was  exalted — not, 
however,  exaggerated.  We  were  given  a  foresight  of  the  day  when 
insurance  will  cover  every  human  activity.  We  were  given  a  fore- 
sight of  the  day  when  it  will  cover  the  activities  of  the  world,  and 
we  were  inspired  to  a  broader  degree  as  citizens.  We  were  re- 
minded, as  we  were  constantly  reminded  during  the  last  year,  and 
particularly  during  the  last  few  months,  of  a  responsibility  of 
citizenship  not  confined  to.  state,  not  confined  to  nation,  but  that 
must  cover  the  whole  broad  brotlierhood  of  humanity.  Yester- 
day's proceedings  made  a  fit  setting  for  what  is  to  follow,  and  I 
congratulate  you  on  the  program  whieh  is  made  out  for  us  to-day. 


WORLD'S  INSURANCE  CONGRESS  35 

"We  are  particularly  honored  to-day  by  the  choice  made  of  the 
Special  Chairman  who  will  have  entire  charge  of  the  proceedings 
of  the  day,  the  distinguished  Senator  from  Illinois.  In  our  con- 
ception there  are  few  honors  which  can  be  bestowed  upon  an 
individual,  few  responsibiliies  higher  or  greater  than  those  of  a 
United  States  Senator.  Of  course,  we  all  recognize  there  is  one. 
Now,  as  a  native  of  Ohio,  you  would  not  expect  me  to  concede 
that  the  next  President  of  the  United  States  is  liable  to  come  from 
another  state,  but  if  he  is,  if,  as  has  occurred  about  once  or  twice 
in  the  last  fifty  years  by  a  fluke  of  politics,  the  President  of  the 
United  States  is  taken  from  some  other  state,  and  it  should  happen 
that  next  j^ear  we  should  witness  another  such  a  fluke,  I  can 
assure  you  that  I  expect  on  behalf  of  the  citizens  of  Ohio  that 
they  wall  be  very  much  consoled  if  the  gentleman  who  shall  be 
chosen  is  the  distinguished  Chairman  who  is  to  preside  over  this 
Congress  to-day;  and  the  people  of  Ohio  will  be  more  consoled 
because  he  comes  from  Ohio.  He  was  born  in  Ohio,  and  I  am 
afraid  that  that  is  going  to  make  his  chances  against  our  real 
Ohio  candidate  a  good  deal  stronger. 

"He  is  not  only  a  great  statesman,  but  he  is  a  great  student  of 
the  problems  that  affect  the  world  to-day,  and  he  has  been  a  pro- 
found student  of  the  institution  of  insurance.  In  his  public  ad- 
dresses, in  his  official  career,  he  has  evinced  a  deep  knowledge  and 
much  learning  upon  the  subject  which  we  are  discussing  in  this 
World 's  Insurance  Congress ;  and  now,  ladies  and  gentlemen,  with- 
out any  further  remarks  upon  the  subject,  because  they  are  un- 
necessary, I  am  particularly  delighted  to  turn  this  Convention  over 
to  the  Honorable  Lawrence  Y.  Sherman  of  Illinois." 

[The  address  of  Senator  Sherman  will  he  found  on  page  91.] 

Special  Chairman  Introducing  R.  W.  Osborn 

"Mr.  R.  W.  Osborn,  President  of  the  Board  of  Fire  Under- 
writers of  the  Pacific  and  INIanager  of  the  Pennsylvania  Fire  In- 
surance Company,  will  speak  to  the  topic  'Service  Performed  by 
Fire  Insurance  Companies'.  Mr.  Osborn  is  one  of  the  leaders  in 
fire  underwriting  on  the  Pacific  Coast.  He  is  a  man  who  stands 
high  in  the  conservative  citizenry  of  the  City  and  State,  and  even 
beyond  the  limits  of  the  State.  I  have  the  pleasure  of  presenting 
to  you  Mr.  Osborn." 

[The  address  of  Mr.  Osborn  will  he  found  on  page   95.] 

Special  Chairman  Introducing  Frank  L.  Gilbert 

"Mr.  Frank  L.  Gilbert  is  the  Vice  President  of  the  National 
Surety  Company  of  New  York.  He  will  address  the  Congress  on 
the  service  performed  by  surety  companies.  Mr.  Gilbert  is  a  man 
who  has  made  a  study  of  the  surety  underwriting  business.     It 


36        WORLD'S  INSURANCE  CONGRESS 

has  been  with  him  a  life  work.  He,  too,  is  a  resident  of  San 
Francisco.  He  has  been  selected  as  Vice  President  of  his  Company 
at  such  long  range  from  his  Home  Office  because  of  his  wide  ac- 
quaintance with  the  problems  that  enter  into  the  business,  and  its 
constructive  w^ork.  He  has  manifested  such  fitness  as  to  bring 
forth  that  confidence  in  his  Home  Office  which  has  resulted  in  his 
high  position  in  this  distant  city.    Mr.  Gilbert." 

[llie  address  of  Mr.  Gilbert  will  be  found  on  page  102.] 

Special  Chairman  Introducing  George  B.  Scott 

"Mr.  Haley  Fiske,  who  is  on  the  program,  is  prevented  from 
coming  to  San  Francisco  on  this  occasion.  His  only  nephew  is  to 
be  ordained  as  a  Bishop  in  the  Episcopalian  Church.  He  could 
not  break  that  duty  that  he  owed  his  presence  elsewhere.  That 
accounts  for  his  absence  here.  In  his  absence  Mr.  George  B.  Scott, 
Manager  of  the  Metropolitan  Life  Insurance  Company  at  San 
Francisco,  will  read  the  paper  that  would  have  been  presented  by 
Mr.  Fiske  if  he  were  present.  The  attitude  of  the  INIetropolitan 
Life  Insurance  Company  in  social  service  is  very  well  known  to  the 
general  public  in  this  country,  and  needs  no  further  introduction. 
Mr.  Scott." 

George  B.  Scott's  Opening  Remarks 

"I  am  here,  Mr.  Chairman  and  ladies  and  gentlemen,  in  a  rep- 
resentative and  not  an  individual  capacity,  and  therefore  I  can- 
not abuse  the  privilege  thus  accorded  me  by  injecting  anything 
personal ;  but  I  am  sure  that  if  the  writer  of  this  paper  that  I  am 
about  to  present  were  here,  he  would  express  his  very  great  pleas- 
ure at  being  privileged  to  appear  before  this  audience.  Those  of 
you  who  have  been  attracted  this  morning  by  the  announcement 
that  Mr.  Fiske  was  to  present  a  paper  must  feel  very  much  dis- 
appointed that  he  is  not  here  to  present  it  in  person,  and  on  his 
behalf  I  apologize  to  you  for  his  not  coming.  I  apologize  on  my 
own  behalf  also  for  appearing  in  his  place.  I  -tvill  now  read  his 
paper. ' ' 

[Mr.  Fishers  paper  will  be  found  on  page  106.] 

Special  Chairman  Introducing  T.  L.  jNTiller 

"Mr.  T.  L.  Miller,  President  of  the  West  Coast-San  Francisco 
Life  Insurance  Company,  is  to  speak  on  the  topic  'Service  Per- 
formed by  Life  Insurance  Companies'.  Mr.  Miller  is  well  known 
here  and  elsewhere,  is  prominent  in  the  financial  and  commercial 
activities  of  San  Francisco,  is  a  liberal,  public  spirited  citizen, 
and  deservedly  occupies  the  place  that  he  does.  I  have  the  honor 
of  introducing  Mr.  Miller." 

[The  address  of  Mr.  Miller  will  be  found  on  page  115.] 


WORLD'S  INSURANCE  CONGRESS  37 

Special  Chairman  Closing  Morning's  Session 

"The  address  of  Charles  W.  Scovel  will  be  deferred  until  the 
afternoon  meeting.     It  is  now  past  adjournment  hour." 

Robert  Lynn  Cox  Speaking  from  Floor 

"May  I  announce  on  behalf  of  the  Resolutions  Committee  that 
there  will  be  a  meeting  at  eight  o'clock  to-night  in  the  Palace 
Hotel,  and  it  is  the  hope  of  that  Committee  that  the  members  of 
the  Committee  on  Permanent  Organization  may  jointly  meet  with 
them." 

Afternoon  Session 

Special  Chairman  Introducing  David  Van  Schaack 

"Mr.  David  Van  Schaack,  Director  of  the  Bureau  of  Inspection 
and  Accident  Prevention  of  the  Aetna  Life  Insurance  Company, 
and  a  member  of  the  Executive  Committee  of  the  National  Safety 
Council,  M-ill  now  address  you.  Mr.  Van  Schaack  is  a  resident  of 
Hartford,  Connecticut,  and  is  the  author  of  a  number  of  text 
books  on  accident  prevention.  He  has  also  had  newspaper  experi- 
ence with  the  New  York  Sun.  Mr.  Van  Schaack  will  speak  of  the 
'Service  Performed  by  Casualty  and  Liability  Companies'." 

[The  address  of  Mr.  Van  Schaack  will  he  found  on  page  119.] 

Special  Chairman  Introducing  Charles  W.  Scovel 

"It  is  my  pleasure  now  to  announce  an  address  by  Charles  W. 
Scovel  of  Pittsburgh.  I  preface  this  statement  by  saying  that 
his  subject  is  on  the  service  performed  by  life  insurance  compa- 
nies. Mr.  Scovel  is  a  former  President  of  The  National  Association 
of  Life  Underwriters.  He  has  been  practical  in  his  applied  knowl- 
edge of  life  insurance,  because  he  has  lectured  and  prepared  papers 
for  the  several  universities  in  which  they  have  enlisted  his  ser- 
vice. This  has  brought  home  to  the  audiences — those  in  the  uni- 
versities— the  practical  side  of  life  insurance  from  one  who  is 
competent  to  talk  to  them  on  the  subject.  He  has  worked  out 
some  unusual  ideas  of  just  how  life  insurance  has  been  applied, 
and  can  be  applied  in  the  future  for  the  benefit  of  society  and  for 
the  preservation  and  well  being  of  the  individual  and  his  family. 
I  now  have  the  pleasure  of  introducing  not  only  my  personal 
friend  for  several  years  past,  but  Mr.  Charles  W.  Scovel,  of  Pitts- 
burgh." 

[The  address  of  Mr.  Scovel  will  he  found  on  page  126.] 

Special  Chairman  Introducing  E.  M.  Treat 

"I  now  have  the  pleasure  of  presenting  Mr.  E.  M.  Treat,  of 
St.  Louis,  Missouri.    Mr.  Treat  is  President  of  the  American  Credit- 


38        WORLD'S  INSURANCE  CONGRESS 

Indemnity  Company  of  that  city.  He  will  speak  of  the  service 
performed  by  credit  insurance.  This  represents  a  new  line  of  in- 
surance in  this  country,  and  Mr.  Treat  is  probably  the  best  in- 
formed authority  on  this  branch  of  insurance  that  there  is  avail- 
able at  this  time.  It  takes  legitimate  business  out  of  the  realm 
of  speculation  and  reduces  it  to  that  class  of  certainty  whereby 
the  same  protection  is  extended  that  insurance  extends  in  other 
departments.    I  now  have  the  pleasure  of  introducing  Mr.  Treat. 

[The  address  of  Mr.  Treat  will  be  found  on  page  139.] 

Special  Chairman  Introducing  J.  B.  Levison 

"I  have  the  pleasure  of  introducing  to  the  audience  Mr.  J.  B. 
Levison.    I  have  the  privilege  of  announcing  that  he  is  one  of  the 
original  organizers  of  the  Exposition.     This  is  the  last  and  only 
opportunity  I  will  have  to  say  publicly  for  myself  that  the  Expo- 
sition presents  to  the  people  of  the  Northern  Mississippi  Valley 
who  have  come  here  the  most  attractive  and  original  exposition 
that  we  have  ever  attended.     I  say  that  for  myself.     I  have  at- 
tended some  of  the  largest  expositions  held   in  North  America. 
There  is  nothing  more  attractive  to  me  than  this  Exposition  that 
has  been  held,  and  is  now  in  progress,  in  this  City.     I  say  this 
as  preliminary  to  the  statement  that  Mr.  Levison  belongs  to  the 
type  of  man  that  is  great,  because  he  has  certainly  contributed 
by  the  force  of  his  originality  and  character  to  the  promotion  and 
creation  of  this  Exposition.    Mr.  Levison  is  Vice  President  of  the 
Fireman's  Fund  Insurance  Company,  and  I  wish  to  say  to  him 
that  I  have  known  of  that  company  ever  since  I  have  been  in  busi- 
ness—more than  thirty-six  years.     It  has  been  an  honorable  busi- 
ness enterprise,  and  of  that  type  which  is  eminently  worthy  of 
emulation.     I  need  say  nothing  of  Mr.  Levison  more  than  that  he 
has  been  a  leader  in  both  public  and  private  undertakings,  and 
is  known  far  beyond  the  limits  of  California,  and  it  affords  me 
great  pleasure  now  to  introduce  him  to  the  audience." 
[The  address  of  Mr.  Levison  will  he  found  on  page  143.] 

Special  Chairman  Introducing  Alvin  E.  Pope 

"The  next  speaker  will  be  Mr.  Alvin  E.  Pope,  who  is  Chief  of 
the  Departments  of  Education  and  Social  Economy  of  the  Panama- 
Pacific  International  Exposition.  In  that  capacity  he  has  had 
under  his  jurisdiction  Insurance,  which  has  for  the  first  time 
in  any  such  undertaking  been  classed  as  a  factor  in  social  economy. 
This  has  afforded  him  an  opportunity  to  make  some  study  of  the 
constructive  influence  of  insurance  in  that  work,  and  he  has  en- 
titled his  paper  '  The  Force  of  Insurance  and  Social  Economy  from 
an  Exposition  Standpoint'.  I  take  pleasure  in  introducing  Mr. 
Pope." 

[The  address  of  Mr.  Pope  will  he  found  on  page  146.] 


WORLD'S  INSURANCE  CONGRESS  39 

Closing  Address  of  the  General  Chairman 

"This  closes  the  program  for  to-day,  and  the  Congress  will  con- 
vene in  this  room  again  to-morrow  morning  at  ten  o'clock." 

End  of  the  Second  Day's  Proceedings. 


WEDNESDAY,  OCTOBER  6TH,  1915 
"associations:  the  insurance  universities" 

General  Chairman  Introducing  Willard  Done 

"Mr.  F.  W.  Kellogg  was  expected  to  preside  at  the  meeting 
to-day,  but  on  account  of  the  serious  illness  of  a  member  of  his 
family,  taking  him  down  to  Pasadena  to  a  hospital,  he  is  unable 
to  be  here.  We  are  fortunate,  however,  in  the  selection  by  the 
Committee  of  the  Special  Chairman  to-day  to  take  the  place  of 
Mr,  Kellogg,  namely,  in  the  person  of  Honorable  Willard  Done. 
Mr.  Done  was  for  a  long  time  the  Commissioner  of  Insurance  in 
the  State  of  Utah.  Mr.  Done  is  the  kind  of  man  that  whenever 
he  touches  anything  it  is  the  better  for  his  contact  with  it.  As 
Commissioner  of  Insurance  in  the  State  of  Utah,  and  particularly 
as  a  member  of  the  National  Convention  of  Insurance  Commis- 
sioners, Mr,  Done  was  a  vital,  important  and  constructive  force. 
He  resigned  from  his  office  as  Insurance  Commissioner  of  the 
State  of  Utah  to  accept  the  position  of  Assistant  General  Counsel 
of  the  National  Board  of  Fire  Underwriters,  He  is  a  member 
of  the  Executive  Committee  of  the  World's  Insurance  Congress; 
and  it  is  my  pleasure,  ladies  and  gentlemen,  to  introduce  to  you 
now  Honorable  Willard  Done  of  Utah,  who  will  preside  over  the 
affairs  to-day," 

[The  address  of  Mr.  Bone  will  he  found  on  page  149.] 

Special  Chairman  Introducing  Isaac  Miller  Hamilton 

"I  first  have  the  pleasure  of  introducing  the  representative  of 
the  American  Life  Convention.  This  Convention  is  made  up  of 
about  one  hundred  legal  reserve  life  insurance  companies  in  vari- 
ous parts  of  the  United  States.  The  constructive  work  that  this 
association  or  convention  is  doing  is  well  known  to  all  of  us  who 
are  in  the  business.  The  one  who  has  been  appointed  to  represent 
this  Convention  is  well  qualified  to  present  its  claims  for  our  con- 
sideration, and  to  state  its  purposes  to  us.  I  take  great  pleasure 
in  introducing  to  you  the  President  of  the  Federal  Life  Insurance 
Company  of  Chicago,  Mr,  Isaac  Miller  Hamilton." 

[The  address  of  Mr.  Hamilton  will  he  found  on  page  150,] 


40        WORLD'S  INSURANCE  CONGRESS 

Special  Chairman  on  Conclusion  of  1\Ir.  Hamilton's  Address 

"A  splendid  presentation  of  the  cause  of  the  American  Life 
Convention." 

Special  Chairman  Introducing  I.  I.  Boak 

"The  National  Fraternal  Congress  of  America,  comprising  in 
its  membership  a  great  number  of  the  leading  fraternal  organiza- 
tions, is  most  fortunate  in  its  representative  here  to-day.  Head 
Consul  of  the  Pacific  Jurisdiction  of  the  Woodmen  of  the  World, 
with  his  headquarters  for  years  at  Denver,  Colorado,  this  gentle- 
man has  long  been  a  leading  force  and  factor  in  the  affairs  of  fra- 
ternal organizations.  He  has  taken  the  initiative,  with  his  organi- 
zation, in  the  movement  for  permanency  and  adequacy  of  rates. 
In  all  other  constructive  directions  he  has  been  a  strong  and  mas- 
terful leader.  I  take  great  pleasure  in  introducing,  as  the  repre- 
sentative of  the  National  Fraternal  Congress  of  America,  Mr.  I.  I. 
Boak,  Member  of  its  Executive  Committee  and  Head  Consul  of 
the  Pacific  Division  of  the  Woodmen  of  the  World.    Mr.  Boak." 

[The  address  of  Mr.  Boak  will  he  found  on  page  155.] 

Special  Chairman  at  Conclusion  op  IMr.  Boak's  Address 

"After  hearing  this  splendid  presentation  of  the  aims  and  pur- 
poses of  fraternalism  and  the  National  Fraternal  Congress  of 
America,  I  know  that  you  are  all  impressed  with  the  possibilities 
of  this  body  as  an  instrument  for  education,  for  conservation,  for 
legislation.  Its  cooperation  with  us  in  those  directions  will  be 
most  potent  and  most  valuable." 

Special  Chairman  Introducing  C.  H.  Wood  worth 

"I  now  have  the  pleasure  of  presenting  the  representative  of 
one  of  the  largest  of  the  national  associations  of  insurance  agents 
— an  association  which  was  organized  a  few  years  ago  for  the 
purpose  of  bringing  about  a  better  mutual  understanding  among 
those  engaged  in  insurance  work — the  field  men,  whose  personal 
contact  with  the  public  is  of  vital  moment  to  the  companies  and  to 
the  public — the  men  who  for  all  practical  purposes  are  the  com- 
panies in  the  estimation  of  the  public.  This  association  has  done 
a  world  of  good.  It  has  a  world  of  possibilities  before  it.  It  has, 
as  its  representative  to-day,  a  man  of  national  reputation,  a  man 
known  for  his  constructive  influence  among  his  fellows  in  the 
insurance  business,  a  man  who  realizes  the  responsibilities  which 
rest  upon  one  who  is  the  evangel  of  this  great  system  of  pro- 
tection to  the  public,  and  one  who  adequately  and  constantly 
discharges  this  responsibility.  I  take  great  pleasure  in  introducing 
to  you  as  the  representative  of  the  National  Association  of  Insur- 
ance Agents  ]\Ir.  C.  H.  Wood  worth,  a  former  President  of  that 


WORLD'S  INSURANCE  CONGRESS  41 

body  and  now  connected  with  the  Woodworth-Hawley  Company  of 
Buffalo,  New  York.     Mr.  Woodworth." 

[The  address  of  Mr.  Woodworth  will  he  found  on  page  160.] 

Special  Chairman  on  Conclusion  of  Mr.  Woodworth 's  Address 

* '  The  aim  and  purposes  of  the  National  Association  of  Insurance 
Agents,  as  set  forth,  I  am  sure  receive  the  endorsement  of  the 
members  of  this  Congress,  and  we  all  desire  to  cooperate  in  bring- 
ing about  the  objects  of  that  association." 

Special  Chairman  Introducing  H.  H.  Ward 

"Not  many  years  ago  the  life  insurance  agent  was  a  sort  of 
Esau  among  his  fellows,  his  hand  against  every  man's,  every 
man's  hand  against  him.  The  representatives  of  different  com- 
panies sometimes  had  lain  down  together,  but  it  was  always  with 
the  hatchet  inside  the  line.  If  the  hatchet  was  ever  buried  be- 
tween them,  it  was  usually  buried  in  the  head  of  the  unfortunate 
competitor.  Since  that  time,  however,  a  wonderful  change  has 
occurred,  and  I  have  witnessed  that  change  myself  in  my  own 
experience  since  entering  the  business  of  life  insurance  some 
fifteen  years  ago.  It  is  a  change  for  the  better,  whereby  friend- 
liness and  cooperation  have  taken  the  places  of  unfriendliness  and 
bitterness,  and  has  been  due,  more  than  anything  else,  to  the  asso- 
ciations, local  and  national,  of  life  insurance  agents.  The  com- 
panies have  also  been  encouraged  by  these  associations  in  higher 
and  more  ethical  practices.  In  the  distribution  of  literature,  and 
in  other  directions,  the  influence  of  the  work  of  these  associations 
has  been  seen,  as  it  has  been  in  the  attitude  and  the  acts  of  the 
company  managers.  I  therefore  speak  ^\^th  great  admiration  and 
honest  reverence  of  the  excellent  constructive  work  that  has  been 
done  by  The  National  Association  of  Life  Underwriters  and  in 
local  organizations. 

"You  will  see  in  the  most  conspicuous  places  in  our  insurance 
journals  this  magic  slogan  'Come  to  the  Pacific  with  Ward'.  I 
have  pleasure  in  introducing  Mr.  H.  H.  Ward,  former  President 
of  The  National  Association  of  Life  LTnderwriters  and  Manager 
for  the  Pacific  ]\rutual  Life  Insurance  Company  in  Portland, 
Oregon.  Before  giving  Mr.  Ward  the  platform,  however,  I  wish 
to  say  that  he  is  lame,  and  we  are  going  to  allow  him  to  sit  when- 
ever he  wants.    Mr.  Ward." 

[The  address  of  Mr.  Ward  will  he  found  on  page  164.] 

Special  Chairman  on  Conclusion  of  Mr.  Ward's  Address 

"I  feel  a  deep  debt  of  gratitude  to  Mr.  Ward  for  his  pains  in 
dealing  with  the  wonderful  work  of  his  orgainzation,  and  I  think 
that  he  has  been  too  modest  in  speaking  of  his  ovm  part.    I  know 


42        WORLD'S  INSURANCE  CONGRESS 

^Ir.  Ward  has  been  one  of  the  strongest  leaders  in  life  insurance 
circles  in  this  country.  I  know  to  him  is  due  very  much  of  the 
credit  for  what  has  been  accomplished  and  what  will  be  accom- 
plished in  the  future,  and  personally  I  desire  to  thank  him  for 
his  excellent  presentation. 

"Gentlemen,  this  concludes  the  set  program  for  the  morning." 

[The  address  of  E,  W.  de  Leon,  President  of  the  Casualty  Com- 
pany of  America,  on  " Internat'ionnl  Association  of  Casualty  and 
Surety  Underwriters" ,  which  was  schedided  for  the  morning 
sessian,  was  not  read.    It  will  he  found  an  page  173.] 


Afternoon  Session 

Special  Chairman  Introducing  Franklin  H.  Wentworth 

"The  excessive  fire  waste  of  the  United  States  is  a  matter  of 
great  and  growing  interest  to  all  thoughtful  citizens.  Men  and 
organizations  are  taking  active  steps  to  lessen  this  waste  by  effec- 
tive methods  of  fire  protection  and  prevention. 

"A  leader  in  this  work  is  the  National  Fire  Protection  Associ- 
tion,  with  headquarters  in  Boston.  We  are  very  fortunte  in  hav- 
ing the  Secretary  of  that  organization  with  us  to-daJ^  For  years 
he  has  been  an  enthusiastic  and  industrious  advocate  of  practical 
means  of  checking  our  appalling  fire  waste.  Whether  he  becomes 
discouraged  in  his  efforts  I  do  not  know.  That  the  results  achieved 
do  not  equal  his  desires,  there  can  be  no  doubt,  but  he  may 
console  himself  with  the  thought  that  the  fire  waste  is  not  keep- 
ing pace  with  the  great  increase  in  property  values,  and  that  the 
public  is  manifesting  an  increased  interest.  Largely  through  his 
activities  some  states  have  enacted  personal  liability  laws,  and 
next  Saturday,  the  anniversary  of  the  Chicago  conflagration  of 
1871,  has  been  proclaimed  by  the  governors  of  a  number  of  states 
as  'Fire  Prevention  Day.'  I  think,  therefore,  the  movement  is 
gro^\ang,  slowly,  as  all  great  movements  must  grow,  but  none  the 
less  surely. 

"I  have  the  honor  to  introduce  Mr.  Franklin  H.  Wentworth,  of 
Boston,  the  Secretary  of  the  National  Fire  Protection  Association." 

[The  address  of  Mr.  Wentworth  will  he  found  on  page  177.] 

Special  Chairman  on  Conclusion  of  Mr.  Wentworth 's  Address 

"I  cannot  commend  this  scholarly  paper  to  you  too  highly,  and 
I  trust  that  the  message  that  it  conveys  so  briefl,y  but  so  well  will 
be  a  message  that  you  will  take  to  yourselves.  Fire  prevention  is 
a  public  matter.  The  movement  which  ]Mr.  Wentworth  represents 
is  a  popular  movement.  It  cannot  be  made  too  public,  nor  too 
popular.     It  is  the  individual  duty  of  every  man  to  become  his 


WORLD'S  INSURANCE  CONGRESS  43 

brother's  keeper  with  reference  to  the  fire  waste — to  see  that  his 
effort  is  in  the  direction  of  prevention  and  elimination.  Wherever 
you  can  wield  influence,  I  trust  that  not  only  in  this  but  in  the 
coming:  years  you  will  impress  upon  your  neighbors  and  those 
with  whom  you  come  in  contact  the  necessity  of  following  the 
sound  advice  of  fire  protection  and  prevention  which  we  have 
had  so  well  presented." 

Special  Chairman  on  Reading  Address  of  Charles  A,  Peabody 

"I  regret  that  the  next  speaker  announced  on  the  program  is 
unable  to  be  present  with  us.  We  had  the  privilege,  on  the  open- 
ing day  of  this  Congress,  of  listening  to  a  remarkable  address 
from  one  of  the  great  life  insurance  presidents  and  we  regret 
very  much  that  another  of  these  presidents,  announced  in  the 
program  for  this  afternoon,  has  found  it  impossible  to  be  present. 
Mr.  Charles  A.  Peabody  was  to  have  spoken  on  the  subject  of  the 
Association  of  Life  Insurance  Presidents,  responding,  of  course, 
to  the  general  topic  of  the  insurance  associations  as  universities. 
I  am  glad  to  say,  however,  that  the  paper  which  he  has  prepared 
is  in  my  hands,  and  I  have  been  requested  to  read  it.  Mr.  Pea- 
body's  prominence  as  President  of  The  Mutual  Life  Insurance 
Company  of  New  York,  his  efficiency  in  the  world  of  finance,  are 
the  causes  which  make  his  paper  valuable  and  at  the  same  time 
prevent  him  from  being  here  to  read  it,  as  he  became  involved  in 
the  negotiations  for  the  loan  that  is  being  made  to  the  Allies,  and 
was  unable  to  get  away  to  come  West  and  meet  with  us.  These 
are  Mr.  Peabody 's  words : 

[3Ir.  Peabody's  paper  ivill  he  found  on  page  180.] 

Special  Chairman  on  Conclusion  o*f  Mr.  Peabody's  Paper 

"I  am  glad  indeed  to  have  had  the  privilege  of  presenting  this 
paper,  although  a  life  insurance  president  from  the  Pacific  Coast 
narrowly  escaped  being  called  upon  by  coming  in  a  little  late.  The 
Association  of  Life  Insurance  Presidents,  representing  thirty  of 
the  largest  and  oldest  life  insurance  companies  of  the  United 
States,  sends  forth  a  paper  here  which  is  most  instructive,  and 
which  we  can  all  take  to  heart  in  the  work  that  we  are  doing. ' ' 

Special  Chairman  Introducing  Mark  T.  McKee 

* '  A  movement  of  recent  origin  is  now  to  be  represented.  A  num- 
ber of  the  insurance  interests  of  the  country,  commencing  espe- 
cially with  the  casualty  men,  have  become  aroused  in  recent  years 
to  certain  dangers  of  a  communistic  character  which  confront  the 
business  and  those  engaged  in  it.  This  danger  has  become  so 
imminent  in  the  case  of  the  casualty  companies  that  they  took  the 
initiative  a  short  time  ago  in  forming  an  organization  that  came 


44        WORLD'S  INSURANCE  CONGRESS 

to  be  known  as  a  federation,  made  up  ehietly  at  first  of  their  own 
members,  but  afterwards  including  such  other  insurance  interests 
as  felt  like  allying  themselves  with  the  federation.  This  move- 
ment, which  had  its  origin,  I  think,  in  the  fertile  brain  of  Mr. 
W,  S.  Diggs,  of  Ohio,  has  now  become  a  nation  wide  movement, 
and  as  a  result  of  it  there  has  been  organized  what  is  known  as 
a  National  Council  of  Insurance  Federation  Executives.  Mr. 
Diggs  had  at  first  accepted  the  invitation  to  appear  on  this  pro- 
gram and  represent  this  Council,  but  circumstances  involving  ill- 
ness and  some  other  untoward  events  prevented  his  coming.  The 
Council,  however,  will  be  very  worthily  represented. 

"I  have  had  the  privilege  of  hearing  an  address  by  the  young 
man  who  is  to  speak  here,  and  I  know  that  you  have  a  treat  in 
store  for  you.  The  movement  is  a  very  active  and  important  one. 
It  is  formed  on  what  has  recently  taken  shape  in  one  chief  direc- 
tion, namely,  the  discouragement  and  defeat  of  communistic  experi- 
ments of  state  insurance,  especially  state  monopolistic  control  of 
the  workmen's  compensation  trend  of  insurance.  Of  course,  it 
was  spread  to  other  lines  as  well,  and  the  objects  and  purposes 
of  the  Federation  can  best  be  presented  to  you  by  him  who  has 
been  selected  as  the  speaker  for  this  occasion. 

"I  take  great  pleasure  in  introducing  to  you  Mr.  Mark  T. 
McKee,  who  is  Secretary-Treasurer  of  the  National  Council  of 
Insurance  Federation  Executives,  coming  here  from  Detroit,  Michi- 
gan.   Mr.  McKee." 

[The  address  of  Mr.  McKee  will  he  found  on  page  188.] 

SpecixVl  Chairman  on  Conclusion  of  Mr.  McKee 's  Address 

"  I  am  sure  that  we  can  all  sympathize  very  strongly  and  keenly 
with  the  aims  and  purposes  of  this  great  Insurance  Federation 
in  combatting  the  imminent  dangers  which  now  confront  certain 
branches  of  the  business.  I  am  grateful  to  Mr.  McKee  for  his 
masterly  presentation  of  the  subject." 

Special  Chairman  Introducing  William  G.  Wilson 

"Some  three  years  ago,  in  my  work  as  a  supervisor  of  insur- 
ance, I  found  it  my  duty,  both  pleasant  and  unpleasant,  to  enter 
into  something  of  a  controversy  with  a  fellow  supervisor  in  the 
interests  of  a  certain  business  proposition  which  developed  between 
the  casualty  managers  and  their  agents  in  the  field,  particularly 
in  the  field  where  I  was  supervising  insurance.  The  histoiy  of 
that  controversy  has  been  written  into  the  insurance  history  of 
the  country,  and  it  forms,  I  think,  one  of  the  most  instructive, 
and  at  the  same  time  one  of  the  most  encouraging  features  of  our 
history. 

"I  will  not  go  into  that  in  detail,  but  will  say  this:  that  as  a  re- 
sult of  our  activities  then,  there  was  called  to  meet  at  Chicago, 


WORLD'S  INSURANCE  CONGRESS  45 

nearly  three  years  ago,  I  think,  the  first  assembly  of  its  kind  in  the 
history  of  insurance,  where  the  managers  of  these  companies  and 
the  agents  of  these  companies  were  brought  together  with  the  Com- 
missioners of  Insurance  as  aids  and  assistants  in  the  composing  of 
differences  and  in  the  reaching  of  conclusions  and  agreements  be- 
tween the  parties  to  the  controversy.  Differences  were  smoothed 
over,  agreements  reached  which  were  satisfactory  to  all  concerned, 
and  this  gathering  marked  an  epoch  in  the  history  of  insurance 
and  insurance  supervision,  and  pointed  the  way  very  largely  to- 
ward the  cooperation  which  we  are  now  endeavoring  to  advance 
through  the  medium  of  this  Congress. 

"The  body  of  insurance  agents  who  were  interested  in  this  con- 
troversy is  represented  here  to-day.  I  regret  very  much  that  the 
body  of  insurance  managers  which  formed  the  other  side  of  the 
controversy  was  not  represented  on  the  program  this  morning. 
I  am  sure,  however,  that  the  aims  and  purposes  of  the  National 
Association  of  Casualty  and  Surety  Agents  will  be  well  presented 
to-day.  We  have  here  as  its  representative  a  gentleman  of  promi- 
nence in  the  insurance  world  and  in  the  casualty  underwriting 
field,  and  I  take  very  great  pleasure  in  introducing  to  you  Mr. 
William  G.  Wilson,  Manager  of  the  Aetna  Life  Insurance  Company 
of  Cleveland,  Ohio.    Mr.  Wilson." 

[The  address  of  Mr.  Wilson  will  he  found  on  page  194.] 

Special  Chairman  on  Conclusion  of  Mr.  Wilson's  Address 

"If  the  paper  which  Mr.  Wilson  just  read  to  you  was  as  good 
at  the  beginning  and  in  the  middle  as  it  was  at  the  end,  he  cer- 
tainly stated  his  case  well.  I  was  very  unfortunate  in  being  called 
from  the  hall  during  its  course." 

Special  Chairman  Introducing  Dr.  W.  W.  Beckett 

"On  account  of  the  close  affiliation  between  insurance,  particu- 
larly life  and  accident  and  health  insurance,  and  the  medical  pro- 
fession, it  was  proper  that  the  Association  of  Life  Insurance  Medi- 
cal Directors  should  be  asked  to  become  a  member,  and  should 
become  a  member,  of  the  National  Council  of  the  World's  Insur- 
ance Congress.  It  is  not  necessary  for  me  to  say  anything  regard- 
ing the  high  aims  and  purposes,  and  the  great  achievements  of 
this  Association,  and  the  world  of  good  that  is  being  done  in  the 
prevention  of  disease,  the  conservation  of  life  and  of  health. 
While  on  this  subject  I  may  be  pardoned  for  announcing  to  you 
that  on  Tuesday  next,  under  the  auspices  of  this  Congress,  it  is 
intended  to  devote  a  day  to  the  subject  of  life  conservation,  in- 
cluding a  parade  and  exercises  on  the  Exposition  Grounds.  The 
subject  is  of  such  vital  importance  to  us,  and  is  growing  so  in 
public  interest,  that  we  have  reason  to  believe  that  the  public 
will  show  its  interest  by  participating  in  the  exercises  of  that  day. 


46        WORLD'S  INSURANCE  CONGRESS 

"We  are  very  glad  indeed  to  have  a  worthy  representative  of 
that  Association  on  the  program  this  afternoon — one  whose  emi- 
nence in  his  field  of  work  is  recognized  among  the  general  public 
everywhere.  A  representative  of  the  giant  company  of  the  Pacific, 
he  is  particularly  at  home  in  California.  We  take  pleasure,  there- 
fore, in  welcoming  him  here,  and  I  take  great  pleasure  in  an- 
nouncing as  our  next  speaker  Dr.  W.  W.  Beckett,  Medical  Director 
of  the  Pacific  Mutual  Life  Insurance  Company.    Doctor  Beckett." 

[The  address  of  Dr.  Beckett  will  he  fomid  on  page  197.] 

Special  Chairman  on  Conclusion  of  Dr.  Beckett's  Address 

' '  The  popularizing  of  the  technicalities  of  medical  science  so  that 
we  can  grasp  them,  though  we  are  only  laymen,  has  been  brought 
about  through  such  papers  and  discussions  as  the  one  which  we 
have  listened  to  now — scholarly,  but  yet  so  easily  understood  that 
we  may  grasp  it  and  profit  by  it. 

"Cooperative  effort  by  policyholders  in  life  insurance  com- 
panies to  help  one  another  in  conserving  health  and  life  is  en- 
couraged by  just  such  excellent  discussions  as  this,  and  we  shall 
all  profit  by  it." 

Special  Chairman  Introducing  J.  C.  Adderly 

"The  last  of  the  associations  to  be  represented  this  afternoon 
is  the  National  Association  of  ]\Iutual  Insurance  Company.  Mu- 
tual insurance  is  receiving  just  and  due  recognition  here.  The 
cooperation  of  men  in  the  effort  to  insure  one  another  is  one  of 
the  fundamentals  and  essentials  of  social  life.  The  essentially 
cooperative  and  mutual  character  of  insurance  as  a  whole  is  also 
well  recognized,  and  therefore  we  are  glad  to  know  that  this  large 
branch  of  insurance  is  to  have  an  able  and  creditable  representa- 
tive here  this  afternoon.  To  bear  one  another's  burdens,  to  re- 
lieve one  another's  distress,  to  distribute,  as  far  as  possible,  over 
the  many,  the  calamities  of  the  few,  is  the  aim  of  insurance  as  a 
system.  In  its  mutual  aspect  that  is  its  great  aim.  I  therefore 
take  great  pleasure  in  introducing,  as  the  representative  of  this 
Association,  :Mr.  J.  C.  Adderly,  Secretary  of  the  IMillers  :\Iutual 
Casualty  Company  of  Chicago,  Illinois." 

[The  address  of  Mr.  Adderly  urill  be  found  an  page  199.] 

Special  Chairman  on  Conclusion  op  Mr.  Adderly 's  Address 

"This  paper  seems  a  fitting  conclusion  of  the  proceedings  of 
this  day,  and  serves  to  emphasize,  as  all  the  others  have  done,  the 
common  ground  on  whicli  all  branches  of  insurance  stand,  the 
common  fight  that  all  may  wage,  the  common  object  that  all  seek 
for.     This  concludes  the  set  program  for  to-day." 


WORLD'S  INSURANCE  CONGRESS  47 

Closing  Address  of  the  Special  Chairman 

"If  there  is  anything  in  the  way  of  resolutions,  motions  or 
announcements  that  any  one  desires  to  offer,  the  opportunity  is 
now  given. 

"I  wish,  then,  in  conclusion,  to  thank  the  gentlemen  who  have 
taken  part  in  the  program  for  their  splendid  papers,  and  for  the 
fact  that  on  account  of  their  conciseness  we  have  been  able  to 
conduct  the  proceedings  of  the  day  within  a  reasonable  time 
limit,  and  that  the  work  of  the  day  has  been  of  such  keen  interest 
and  so  profitable.  With  my  thanks  to  those,  also,  who  have  at- 
tended these  sessions  and  thereby  increased  interest,  I  now  de- 
clare the  meeting  adjourned  until  to-morrow  morning  at  ten 
o'clock." 

End  of  the  Third  Day's  Proceedings. 

THURSDAY,  OCTOBER  7TH,  1915 

"broadening  social  economy  through  insurance" 

General  Chairman  Introducing  Robert  Nem^ton  Lynch 

' '  There  is  a  meeting  of  the  California  State  Association  of  Local 
Fire  Insurance  Agents  in  another  room  upstairs,  whose  members 
expect  to  attend  here,  but  in  view  of  the  length  of  the  program 
I  think  we  will  proceed  at  once,  and  I  am  very  much  pleased  to 
introduce  the  Special  Chairman  for  the  day  in  the  person  of 
Mr.  Robert  Newton  Lynch.  Mr.  Lynch  is  Vice-President  of  the 
San  Francisco  Chamber  of  Commerce,  and  in  that  capacity,  and 
in  other  ways,  is  an  active  influence  in  the  affairs  of  San  Fran- 
cisco. Indeed,  his  activities  have  extended  in  a  larger  way  clear 
across  the  Continent,  and  Mr.  Lynch  is  well  known  throughout 
the  country.  I  am  pleased  to  introduce  to  you  the  chairman  of 
the  day,  Mr.  Lynch." 

[The  opening  address  of  Mr.  Lynch  will  he  found  on  page  204.] 

Special  Chairman  Introducing  E.  O.  McCormick 

"I  now  have  great  honor  in  introducing  Mr.  E.  O.  McCormick, 
Vice-President  of  the  Southern  Pacific  Company,  The  Southern 
Pacific  is  probably  the  greatest  corporation  which  we  have  in  the 
whole  West.  It  has  rendered  very  distinguished  service  through- 
out all  the  Western  country,  and  perhaps  throughout  the  United 
States,  and  it  is  due  to  the  foresight  and  ability  of  Mr.  McCor- 
mick that  many  of  the  triumphs  and  successes  of  that  Company 
have  been  brought  about,  and  I  am  sure  he  brings  a  contribution 
that  we  will  be  very  glad  to  receive  from  his  hands." 

[The  address  of  Mr.  McCormick  will  he  found  on  page  205.] 


48        WORLD'S  INSURANCE  CONGRESS 

Special  Chairman  on  Conclusion  of  Mr,  ]\IcCormick's  Address 

"We  expected  a  paper  from  Mr.  McCorrniek,  and  I  am  very 
glad  wet  got  more  than  that  from  him.  We  got  a  sennon.  I 
would  like  to  congratulate  Mr.  McCorraick  upon  his  skillful  appli- 
cation of  Scripture.  He  has  really  given  us  a  sermon,  and  per- 
haps all  of  the  papers  that  will  be  delivered,  not  only  in  this  session 
but  throughout  the  Congress,  will  bring  out  the  very  deep  and 
fundamental  relations  widely  underlying  all  of  these  ideas,  be- 
cause religion  does  concern  itself  considerably  with  the  relation 
of  people  to  each  other.  Perhaps  the  general  text  might  be  sug- 
gested 'Bear  ye  one  another's  burdens'." 

Special  Chairman  Introducing  E.  E.  Rittenhouse 

"Now  the  next  speaker  will  also  bring  forward  a  very  funda- 
mental idea.  The  Life  Extension  Institute  has  a  \ery  inspiring 
and  wonderfully  fascinating  title.  Insurance  is  concerned  with 
the  conserving  and  prolongation  of  life,  and  it  must  occur  to 
every  thoughtful  person  that  we  die  just  about  the  time  we  get 
ready  to  live,  and  I  am  sure  Mr.  Rittenhouse  will  bring  us  a 
message  which  will  stir  ns,  and  suggest  to  us  many  things  in  re- 
gard to  the  deepening  and  prolongation  of  life.  It  gives  me  great 
pleasure  at  this  time  to  introduce  to  you  Mr.  E.  E.  Rittenhouse, 
President  of  the  Life  Extension  Institute  of  New  York." 

[The  address  of  Mr.  Rittenhouse  will  he  found  on  page  211.] 

Special  Chairman  on  Conclusion  of  Mr.  Rittenhouse 's  Address 

"I  think  all  of  those  present  will  thank  Mr.  Rittenhouse  for 
his  able  paper." 

Special  Chairman  Introducing  Dr.  F.  G.  Cottrell 

"The  next  speaker  is  Dr.  F.  G.  Cottrell,  of  the  United  States 
Bureau  of  Mines.  The  establishment  of  this  Bureau  of  Mines 
recalls  to  my  mind  a  very  significant  incident  related  to  me  not 
long  ago  by  a  former  Immigration  Superintendent.  He  was  inter- 
ested in  the  mine  workers  of  Pennsylvania,  and  in  investigating 
the  situation  discovered  that  there  were  a  certain  number  of  lives 
lost  in  proportion  to  damage  done,  but  in  the  course  of  his  inves- 
tigation discovered  that  the  greater  number  of  lives  were  lost 
not  in  the  mine,  but  on  the  way  from  the  mines  to  the  hospitals, 
which  were  often  located  at  some  distance  away,  and  by  the  simple 
expedient  of  locating  the  hospitals  at  the  mouths  of  the  mines,  as 
a  result  of  that  investigation,  mortality  was  reduced  four  hun- 
dred per  cent. 

"I  am  sure  w^e  w^ill  profit  by  listening  to  the  paper  of  Dr.  F. 
G.  Cottrell,  Chief  Chemist  of  the  United  States  Bureau  of  IMines 
at  San  Francisco.    Dr.  CottrelL" 

[The  address  of  Dr.  Cottrell  will  he  foaind  on  page  211.] 


WORLD'S  INSURANCE  CONGRESS  49 

Special  Chairman  on  Conclusion  op  Dr.  Cottrell's  Address 

"We  thank  Dr.  Cottrell  for  his  very  interesting  and  instructive 
effort." 

Special  Chairman  Introducing  Arthur  Hawxhurst 

*'The  next  speaker  will  represent  a  modern  department  store. 
I  think  there  is  not  a  sufficient  appreciation  in  the  country  at  the 
present  time  of  the  tremendous  contribution  that  has  been  ren- 
dered the  social  life  in  this  country  by  the  modern  department 
store.  Marshall  Field  and  Company  occupy  a  preeminent  position 
in  that  respect.  It  is  a  department  store  that  has  followed  high 
principles,  and  we  are  certainly  privileged  to  have  with  us  to-day 
Mr.  Arthur  Hawxhurst,  Insurance  Manager  of  Marshall  Field 
and  Company,  who  will  speak  of  the  relation  of  such  a  move- 
ment to  the  insurance  idea.    Mr.  Hawxhurst. ' ' 

[The  address  of  Mr.  Haivxhurst  will  he  found  on  page  225.] 

Special  Chairman  Introducing  Harry  P.  Coffin 

"Ladies  and  Gentlemen:  The  hour  is  getting  very  late,  and 
the  next  paper  is  a  very  important  one.  It  deals  with  the  offi- 
cial side  of  the  public  safety  movement,  and  has  as  its  exponent 
a  gentleman  who  is  familiar  with  the  whole  genesis  of  this  move- 
ment, because  Safety  First  started  in  the  Northwest.  Is  it  the 
pleasure  of  the  audience  that  this  paper  be  presented  now,  or  in 
our  afternoon  session?  Either  course  will  be  agreeable  to  the 
speaker.  (Audience  requested  that  paper  be  heard.)  Permit 
me,  then,  to  introduce  to  you  Mr.  Harry  P.  Coffin,  Chairman  of 
the  Public  Safety  Commission  of  the  city  of  Portland,  Oregon." 

[The  address  of  Mr.  Coffin  will  he  found  on  page  236.] 

General  Chairman  on  Conclusion  of  Mr.  Coffin's  Address 

"We  have  all  enjoyed  hearing  this  paper,  from  the  particular 
mention  that  it  makes  of  modern  conditions  of  life,  as  well  as  for 
its  able  construction. 

' '  We  will  take  a  recess  now,  to  meet  again  this  afternoon  at  two 
o'clock." 

Afternoon  Session 

Special  Chairman  Introducing  C.  E.  Baen 

"Ladies  and  Gentlemen:  We  will  begin  with  our  afternoon 
program,  and  the  order  will  have  to  be  slightly  changed,  because 
]\lr.  Sturgis,  who  was  to  have  been  the  first  speaker,  will  not  be 
here  until  three  o  'clock. 

"In  the  meantime  we  will  call  upon  Mr.  Baen,  who  is  here  to 


50        WORLD'S  INSURANCE  CONGRESS 

speak  from  the  standpoint  of  the  National  Association  of  Credit 
Men.  We  had  this  morning  a  most  instructive  and  interesting 
session.  This  afternoon  we  are  dealing  with  voluntary  organiza- 
tions. The  first  to  be  heard  from  will  be  the  National  Association 
of  Credit  Men.  I  am  pleased  to  introduce  Mr.  C.  E.  Baen,  who  is 
the  Assistant  Manager  of  the  International  Banking  Corporation 
in  San  Francisco." 

[The  address  of  Mr.  Baen  will  he  found  on  page  242.] 

Special  Chairman  on  Conclusion  of  Mr.  B.ven's  Address 

"I  am  very  glad  that  Mr,  Baen's  address  is  going  to  have  per- 
manent record  in  the  activities  of  this  Congress,  for  it  certainly 
deserves  an  audience  capable  of  more  than  filling  this  hall." 

Special  Chairman  Introducing  Arthur  I.  Vorys 

' '  I  will  now  have  the  pleasure  of  introducing  the  gentleman  who 
was  good  enough  to  introduce  me  this  morning,  Mr.  Arthur  I. 
Vorys,  who  will  speak  from  the  standpoint  of  the  American  Bar 
Association." 

[The  address  of  Mr.  Vorys  will  he  found  on  page  246.] 

Special  Chairman  Introducing  James  K.  Lynch 

"I  think  all  of  the  speakers  should  be  congratulated  that  they 
have  so  rigidly  adhered  to  their  subjects.  I  think  it  has  been 
sought  in  the  program  to  secure  the  most  distinguished  represen- 
tatives of  all  of  those  organizations  which  are  here  represented, 
and  very  fortunately  we  have  with  us  a  local  banker,  ]\Ir.  James 
K.  Lynch,  Vice  President  of  the  First  National  Bank  of  San 
Francisco,  who  was  at  a  recent  convention  elected  President  of 
the  American  Bankers'  Association,  and  can  therefore  speak  with 
authority  upon  the  subject  which  he  is  to  cover. 

"I  have  unique  pleasure  in  introducing  INIr.  James  K.  hynch, 
who  will  speak  for  the  American  Institute  of  Banking." 

[The  address  of  Mr.  Lynch  will  he  found  on  page  252.] 

Special  Chairman  Introducing  R.  Clipston  Sturgis 

"I  now  have  the  pleasure  of  introducing  Mr.  R.  Clipston  Stur- 
gis, President  of  the  American  Institute  of  Architects,  who  will 
speak  from  that  standpoint  in  relation  to  the  insurance  idea." 

[The  address  of  Mr.  SUirgis  will  he  found  on  page  256.] 

Special  Chairman  on  Conclusion  of  Mr.  Sturgis'  Address 

"I  think  we  are  disposed  to  thank  Mr.  Sturgis  for  the  very 
delightful  and  splendid  address,  of  which  we  have  enjoyed  every 
moment. ' ' 


WORLD'S  INSURANCE  CONGRESS  51 

Closing  Address  of  the  Special  Chairman 

"This  concludes  the  papers  which  have  been  set  for  the  after- 
noon, except  that  of  Mr.  John  A.  Britton,  who  was  to  have  spoken 
for  the  American  Institute  of  Electrical  Engineers,  but  who  was 
unfortunately  called  away  from  the  city,  and  his  paper  will  be 
read  upon  the  minutes.  We  will  now  adjourn  until  to-morrow 
morning,  when  the  problems  that  have  been  developed  in  these 
deliberations  will  be  taken  up." 

[Mr.  Britton's  paper  mil  he  found  on  page  260.] 

End  of  the  Fourth  Day's  Proceedings 


FRIDAY,  OCTOBER  8TH,  1915 
"present  problems  and  future  contingencies" 

General  Chairman  Introducing  M.  H,  De  Young 

"Those  of  us  who  were  fortunate  enough  to  be  here  yesterday 
I  think  will  always  carry  the  memory  of  it  as  one  of  the  most 
interesting  and  instructive  days  we  ever  experienced.  The  ad- 
dresses showed  great  research  and  study,  and  were  highly  instruc- 
tive to  all  of  us.  The  thing  that  impressed  us,  however,  was  the 
wonderful,  marvelous  work  that  is  being  done  in  a  disinterested 
way  by  so  many  individuals,  so  many  organizations,  for  the  benefit 
of  mankind.  We  left  the  meeting  yesterday,  I  think,  with  a 
spirit  of  optimism  that  we  never  had  before.  Yestei*day  was  de- 
voted to  a  discussion  of  the  broadening  of  social  economy  through 
insurance. 

"To-day  we  have  an  equally  interesting  program  devoted  to  the 
present  problems  and  future  contingencies  of  the  insurance  busi- 
ness. The  Congress  is  particularly  honored  to-day  in  the  person 
of  Mr.  M.  H.  De  Young,  who  will  be  the  Special  Chairman.  It 
is  beyond  my  ability  to  set  forth  to  you  the  career,  the  attain- 
ments, of  Mr.  De  Young.  All  my  life  I  have  heard  of  Mr.  De 
Young,  It  seems  g,s  if  there  was  never  anything  going  on  in 
San  Francisco  but  what  Mr.  De  Young  was  taking  a  leading  part 
in  it.  There  was  never  anything  proposed  in  the  State  of  Cali- 
fornia but  what  he  was  in  the  lead  in  the  discussion,  and  in  pro- 
moting the  interests  of  this  great  State.  It  seems  to  me  there 
was  never  anything  in  the  last  fifty  years  proposed  in  the  United 
States  that  Mr.'  De  Young  was  not  connected  with  it  in  an  active 
and  constructive  way.  He  is  not  only  a  city,  a  state,  a  national 
figure,  he  is  really  a  world  figure.  He  was  President  of  a  former 
exposition  held  in  San  Francisco,  he  is  the  Vice  President  of  this 
Exposition.     He  is  a  great  man. 

"He  came  from  Ohio.  It  seems  to  me,  in  the  couple  of  weeks 
I  have  been  here,  every  place  I  go  I  see  Mr.  De  Young.     I  was 


52        WORLD'S  INSURANCE  CONGRESS 

out  at  the  Washin^on  Day  celebration  and  I  heard  him  describe 
the  glories  of  that  great  Northwestern  country.  I  attended  the 
ceremonies  of  Ohio  Day,  day  before  yesterday,  and  Mr.  De  Young 
was  telling  there  about  the  great  State  of  Ohio.  He  did  not  go 
quite  so  far  as  the  Governor  did,  however.  The  Governor  began 
with  the  Revolutionary  War,  and  explained  how  the  first  and  last 
battles  of  the  Revolution  were  fought  in  Ohio.  He  told  of  the 
careers  of  the  great  men  of  Ohio,  and  then  astounded  us  Ohioans 
when  he  told  how  the  World's  Fair  wouldn't  have  been  a  possi- 
bility if  it  were  not  for  the  State  of  Ohio.  He  told  us  how  that 
wonderful  Tower  of  Jewels  wouldn't  be  there  if  it  weren't  for 
Thomas  A.  Edison,  and  he  told  us  of  those  other  conspicuous  things 
— for  instance  the  flying  machines — that  wouldn't  be  there  for  the 
marvel  of  the  people,  if  it  weren't  for  the  Wright  brothers  of  Day- 
ton, Ohio.  He  went  on  to  say  that  California  wouldn  't  be  much  of 
a  state  if  it  weren't  for  the  seventy  thousand  Ohioans  living  in 
California. 

**I  don't  want  to  make  any  invidious  comparisons,  but  I  do 
think  that  Mr.  De  Young  is  the  best  that  has  been  produced  out 
here,  and  I  take  great  pleasure  in  introducing  as  your  Special 
Chairman  to-day,  Mr.  M.  H.  De  Young." 

[The  address  of  Mr.  De  Young  will  be  found  on  page  268.] 

Special  Chairman  Introducing  William  Sexton 

"The  first  speaker  of  the  day  is  probably  known  to  you  all.  I 
think  you  call  him  '  Uncle  Bill. '    His  name  is  William  Sexton. ' ' 

[The  address  of  Mr.  Sextmi  vrill  he  found  &u  page  273.] 

Special  Chairman  Introducing  F.  Robertson  Jones 

"The  next  speaker,  Ladies  and  Gentlemen,  will  be  Mr.  F.  Rob- 
ertson Jones,  Secretary  of  the  Workmen's  Compensation  Publicity 
Bureau  of  New  York.  He  will  speak  on  the  subject  of  the  taxa- 
tion of  insurance  companies  for  revenue.  I  take  great  pleasure 
in  introducing  Mr.  Jones." 

[The  address  of  Mr.  Jones  will  be  found  on  page  275.] 

Special   Chairman  Introducing   T.  AV.   Blackburn 

"Gentlemen:  After  listening  to  the  able  paper  of  Mr.  Jones, 
and  I  know  you  all  enjoyed  it,  we  are  now  going  to  hear  from  Mr. 
T.  W.  Blackburn,  of  Omaha,  who  will  speak  of  the  views  of  the 
American  Life  Convention  upon  the  subject  of  state  supervision 
of  insurance.  The  American  Life  Convention  is  composed  of  ap- 
proximately one  hundred  of  the  smaller  life  insurance  companies. 
I  take  great  pleasure  now  in  introducing  Mr.  Blackburn,  Secre- 
tary of  that  Convention." 

[The  address  of  Mr.  Blackburn  will  be  found  on  page  287.] 


WORLD'S  INSURANCE  CONGRESS  53 

Special  Chairman  Introducing  Frank  E.  McMullen 

"The  next  is  a  paper  prepared  by  Mr.  Edward  A.  "Woods  on 
the  taxation  of  insurance  companies.  Mr.  Woods  is  President  of 
the  National  Association  of  Life  Underwriters  and  a  resident  of 
Pittsburgh.  Mr.  Woods  is  not  here,  and  Mr.  Frank  E.  McMullen, 
a  prominent  life  insurance  man  of  Los  Angeles,  and  former  Presi- 
dent of  The  National  Association,  will  present  his  document." 

Frank  E.  McIMullen,  Former  President,  National  Association 

OF  Life  Underwriters,  Speaking  on  Behalf  op  Edward 

A.  Woods 

"Mr.  Chairman  and  Gentlemen:  As  the  Chairman  has  an- 
nounced, the  reading  of  Mr.  Woods'  paper  will  not  be  imposed 
upon  you  this  morning,  because  of  the  length  of  the  program,  and 
the  desire  of  the  committee  to  give  ample  time  for  those  who  are 
here  to  present  their  addresses.  The  paper  of  Mr.  Woods  is  on 
the  taxation  of  insurance  companies,  written  under  the  head  'Pen- 
alizing the  Prevention  of  Poverty'  and  is  presented  to  this  Con- 
gress by  me  to  be  printed  in  the  report  of  the  Congress.  It  will 
also  be  printed  in  The  Daily  Field  and  many  other  insurance  jour- 
nals through  the  country,  so  you  may  all  read  it,  and  I  hope  give 
it  much  dissemination.  Mr.  Woods  has  made  an  exhaustive  study 
during  the  past  few  years  of  the  subject  of  taxation  of  life  insur- 
ance companies,  and  I  believe  is  one  of  the  foremost  authorities  on 
that  subject  in  the  United  States.  He  has  written  several  able  ad- 
dresses, perhaps  the  most  important  of  which  is  in  pamphlet  form 
and  has  been  distributed  from  the  Exposition  through  the  booth 
of  The  National  Association  of  Life  Underwriters.  This  pamphlet 
will  also  be  distributed  at  the  door  as  you  leave. 

"I  regret  deeply  that  Mr.  Woods'  personal  affairs  prevented 
his  being  present  at  this  Congress  to  give  his  paper  the  force  of 
his  o\Ma.  personality  and  strength." 

{Mr.  Woods'  paper  will  he  found  on  page  298.] 

Special  Chairman  Introducing  I.  I.  Boak 

"Mr.  I.  I.  Boak,  Head  Consul  of  the  Pacific  Jurisdiction  of  the 
Woodmen  of  the  World,  will  present  a  paper  written  by  George 
W.  Miller,  and  will  ask  that  it  be  put  into  the  minutes  of  the 
Congress. ' ' 

I.  I.  Boak,  Head  Consul  Pacific  Jurisdiction,  Woodmen  of  the 
World,  Speaking  on  Behalf  op  George  W.  jMiller 

' '  Gentlemen :  It  is  to  be  regretted  that  Mr.  Miller  is  unable  to 
be  with  us  this  morning  and  personally  present  his  paper  on  the 
subject  of  national  supervision.  I  know  Mr.  Miller  to  be  one  of 
the  keenest,  cleanest  students  of  insurance  in  its  broader  sense  in 


54        WORLD'S  INSURANCE  CONGRESS 

this  whole  country,  and  I  am  sure  you  would  have  been  glad  to 
have  meet  him  and  known  him  personally,  but  unexpected  busi- 
ness matters  suddenly  developed  which  prevented  his  attendance. 
He  has  asked  me  to  read  a  paper  of  thirty  pages  of  typewritten 
matter,  and  if  you  had  more  time  I  would  be  pleased  to  comply 
with  his  request,  but  inasmuch  as  it  is  desired  to  conclude  shortly, 
I  shall  read  only  two  or  three  paragraphs  from  this  very  excellent 
paper. 

' '  Mr.  Miller  is  a  lawyer  of  broad  experience,  and,  as  I  have  said, 
a  very  deep  student  of  the  question  of  insurance.  He  reflects  in 
this  paper  only  his  own  views.  He  does  not  attempt  to  reflect  the 
sentiment  of  The  National  Fraternal  Congress  of  America,  of 
which  he  is  President,  or  the  views  of  any  other  organization. 

"I  ask,  Mr.  Chairman,  that  this  paper  be  read  into  the  records 
of  this  Congress,  that  it  be  given  the  widest  publicity,  and  per- 
sonally do  I  commend  it  to  your  careful  consideration. ' ' 

[Mr.  Miller's  paper  will  he  found  on  page  306.] 

Special  Chairman  Introducing  Samuel  Davis 

* '  The  next  speaker  will  be  Samuel  Davis,  a  member  of  the  Bos- 
ton Bar.  Mr.  Davis  will  present  his  views  upon  the  subject  of 
national  supervision  of  insurance.     Mr.  Davis." 

[The  address  of  Mr.  Davis  will  be  found  on  page  320.] 

Special  Chairman  Introducing  Charles  F.  Coffin 

"The  last  speaker  we  have  on  the  program  is  j\Ir.  Charles  F. 
Coffin,  Vice-President  of  the  State  Life  Insurance  Company,  who 
will  speak  on  the  subject  of  National  Supervision." 

[The  address  of  Mr.  Coffin  will  he  found  on  page  329.] 

General  Chairman  on  Conclusion  of  Mr.  Coffin's  Address 

"This  remarkably  able  address  of  Mr.  Coffin's,  which  will  take 
its  place  with  many  other  great  papers  that  will  go  into  the  records 
of  this  Congress,  closes  the  program  for  to-day." 

Special  Chairman  on  Behalf  of  David  Starr  Jordan 

"The  next  on  the  program,  David  Starr  Jordan,  Chancellor  of 
Stanford  University,  is  one  of  the  most  prominent  men  we  have 
in  our  country.  Dr.  Jordan,  having  been  informed  that  there  will 
be  no  afternoon  session,  asks  that  his  paper,  entitled  '  Governmen- 
tal Obstacles  to  Insurance'  be  made  a  part  of  the  records  of  the 
Congress  without  reading." 

[Dr.  Jordan's  paper  will  he  found  on  page  337.] 


WORLD'S  INSURANCE  CONGRESS  55 

Closing  Address  of  the  General  Chairman 

"I  desire  on  behalf  of  you,  and  all  of  those  interested  in  the 
business  of  insurance  and  all  of  those  affected  by  the  institution 
of  insurance,  to  express  our  thanks  to  all  of  those  gentlemen  who 
have  addressed  us  this  morning,  and  also  to  Mr.  De  Young,  who 
has  so  well  presided  over  the  deliberations  here  to-day. 

"This  closes  the  meetings  at  this  xVuditoriura,  and  in  dismissing 
the  Congress,  I  desire  to  announce  that  the  National  Council  will 
hold  its  meeting  at  the  Palace  Hotel  at  ten  o'clock  to-morrow  morn- 
ing." 

End  of  the  Fifth  Day's  Proceedings 
SATURDAY,  OCTOBER  9TH,  1915 

MEETING   OF   THE   NATIONAL   COUNCIL 

The  meeting  of  the  National  Council  of  the  World's  Insurance 
Congress  was  held  in  the  Palace  Hotel,  San  Francisco,  at  ten- 
thirty  o'clock  on  the  morning  of  Saturday,  October  9th,  1915. 

Hon.  Arthur  I.  Vorys,  General  Chairman  of  the  Congress,  called 
the  meeting  to  order,  after  which  Robert  Lynn  Cox  assumed  the 
Chair. 

The  following  members  of  the  Council,  representing  the  Asso- 
ciations set  opposite  their  names,  were  present : 

L.  0.  Armstrong  Bureau  of  Commercial  Economics 

(Alternate) 

I.  I.  Boak  National    Fraternal    Congress    of 

America. 

Chas.  H,  Boyer  Southern     Casualty     and     Surety 

Conference. 

George  I.  Cochran  Executive  Committee  of  Congress. 

Robert  Lynn  Cox  Association     of     Life     Insurance 

Presidents. 

Dr.  Cha.s.  T.  Cutting  Health  and  Life  Conservation  Bu- 

reau of  the  Pacific. 

W.  H.  Davis  Association     of     Life     Insurance 

Counsel    ( Alternate ) . 

Hugo  R.  Delfs  International   Association  of  Fire 

Engineers. 

Willard  Done  Executive  Committee  of  Congress. 

William  J.  Dutton  Executive  Committee  of  Congress. 

Walter  C.  Faxon  Bureau  of  Personal  Accident  and 

Health  Underwriters. 

Louis  H.  Fibel  Health   and  Accident  Underwrit- 

ers' Conference. 

W.  L.  Hathaway  Commissioner  of  the  Congress. 


56 


WORLD'S  INSURANCE  CONGRESS 


H.  C.  Heddon 

C.  I.  Hitchcock 

Dr.  Fred'k.  L.  Hoffman 

Charles  H.  Holland 


Bayard  P.  Holmes 
C.  T.  Hughes 

Mark  T.  McKee 


T.  L.  Miller 
C.  W.  Mitchell 


F.  H.  Porter 

G.  M.  Robertson 
A.  W.  Ross 
Charles  W.   Scovel 
A.  F.  Stone 

W.  E.  Straub 

Gordon  Thomson 

David  Van  Schaack 
Arthur  I.  Vorys 
Rolla  V.  Watt 

T.  II.  Williams 

William  G.  Wilson 
C.  II.  Wood  worth 


Plate  Glass  Service  and  Informa- 
tion Bureau. 

Executive  Committee  of  Congress. 

AmericEin  Statistical  Association ; 
American  Museum  of  Safety. 

International  Association  of  Cas- 
ualty and  Surety  Underyriters ; 
Workmen's  Compensation  Serv- 
ice Bureau. 

International  Claim  Association, 

National  Association  of  Credit 
Men. 

National  Council  of  Insurance 
Federation  Executives ;  Michi- 
gan Fraternal  Congress  (Alter- 
nate) 

American  Life  Convention. 

National  Association  of  Electrical 
Inspectors ;  California  Associa- 
tion of  Electrical  Inspectors. 

Fire  Underwriters'  Inspection  Bu- 
reau. 

Fire  Underwriters '  Uniformity 
Association. 

]\Iainland  Fire  Underwriters'  As- 
sociation of  British  Columbia. 

National  Association  of  Life  Un- 
derwriters. 

National  Automatic  Sprinkler  As- 
sociation  (Alternate) 

National  Association  of  Mutual  In- 
surance Companies. 

American  Institute  of  Actuaries 
(Alternate) 

National  Safety  Council. 

American  Bar  Association, 

Board  of  Fire  Underwriters  of  the 
Pacific. 

Fire  Underwriters'  Association  of 
the  Pacific;  Ancient  and  Honor- 
able Order  of  the  Blue  Goose. 
National   Association   of  Casualty 
and  Surety  Agents. 

National  Association  of  Insurance 
Agents. 


There  was  first  presented  by  Robert  Lynn  Cox,  the  report  of 
the  Resolutions  Committee  of  the  World's  Insurance  Congress. 
Three  resolutions  were  submitted. 


WORLD'S  INSURANCE  CONGRESS  57 

Upon  motion  of  Mr.  Isaac  Miller  Hamilton,  seconded  by  Bay- 
ard P.  Holmes,  the  first  resolution  was  unanimously  adopted  as 
read. 

[The  first  resolution  ivill  he  found  on  page  426,] 

Upon  motion  of  T.  L.  Miller  and  second  of  Willard  Done,  the 
second  resolution  was  unanimously  adopted  as  read. 

[TJie  second  resolution  will  he  found  on  page  427.] 

Upon  motion  of  Arthur  I,  Vorys  and  second  of  Charles  H. 
Holland,  the  third  resolution  was  unanimously  adopted  as  read. 

[The  third  resolution  vnll  he  found  on  page  427.] 

There  was  then  presented,  by  Charles  H.  Holland,  the  report  of 
the  Committee  on  Permanent  Organization. 

[The  report  of  this  committee  will  he  found  on  page  428.] 

A  question  was  raised  by  C.  T.  Hughes  as  to  the  wording  of 
Section  Six  of  the  tentative  plan  of  organization,  as  outlined  in 
the  Committee's  report,  relating  to  the  selection  of  alternates  to 
take  the  place  of  delegates  in  the  National  Insurance  Council.  Mr. 
Hughes  suggested  an  amendment  making  plain  the  fact  that  al- 
ternates shall  be  selected  in  the  same  manner  as  regular  delegates, 
viz.,  by  the  associations  which  they  represent.  Section  Six  was 
thereupon  amended,  and  upon  the  motion  of  George  I.  Cochrart 
and  second  of  Willard  Done,  the  report  of  the  Committee  on 
Permanent  Organization  was  unanimously  accepted  as  amended. 

After  acceptance  of  the  report  by  the  Council,  the  Chairman 
called  upon  the  Executive  Committee  of  the  World's  Insurance 
Congress  to  name  a  Provisional  Central  Committee  of  the  Na- 
tional Insurance  Council,  as  provided  in  Section  Eleven  of  the 
report. 

Upon  the  request  of  Commissioner  W.  L.  Hathaway,  the  mem- 
bers of  the  Executive  Committee  withdrew  from  the  Council  meet- 
ing and  formulated  the  following  Provisional  Central  Committee 
of  the  National  Insurance  Council.  Returning  to  the  meeting 
room,  they  presented  their  selection  to  the  Council  for  ratification: 

Robert  Lynn   Cox       ^ 

T.  L.  Miller  [     Representing  life  interests. 

Charles  W.  Scovel       J 


Louis  H.  Fibel 
Charles  H.  Holland 
William  G.  Wilson 


Representing  casualty  and  surety  inter- 
ests. 


E.  G.  Richards  i 

Rolla  V.  Watt  I     Representing  fire  interests. 

C.  H.  Woodworth 


58        WORLD'S  INSURANCE  CONGRESS 

i-     Representing  marine  interests. 


AVilliam  J.  Button 
J.   B.  Levison 


;•     ;  \^^\r  Tr  1      Representing  fraternal,  cooperative  and 

^^'.^''^..^^'^k''  non-stock  interests. 

\\  .  E.  StrauD  J 

A  motion  was  thereupon  offered  by  George  I.  Cochran,  seconded 
by  Arthur  I.  Vorys,  and  unanimously  carried,  that  the  report  be 
so  ratified. 

Arthur  I.  Vorys  then  addressed  the  meeting  upon  the  valuable 
results  contributed  to  the  cause  of  Insurance  by  the  efforts  of  W. 
L.  Hathaway,  Commissioner  of  the  World's  Insurance  Congress 
Events  for  the  Panama-Pacific  International  Exposition.  He  spoke 
in  part  as  follows: 

"If  there  is  no  further  business  before  the  National  Council 
there  is  one  further  matter  I  wish  to  speak  about,  but  I  don 't  speak 
exactly  on  my  own  initiative,  for  it  has  come  to  me  from  quite  a 
number  of  individuals  assembled  here.  There  is  one  gentlemau 
in  the  crowd  here  who  I  wish  wasn't  present,  for  I  would  much 
rather  say  in  his  absence  what  I  don't  like  to  say  before  him. 

"W.  L.  Hathaway  has  been  mentioned  at  various  times  during 
the  proceedings  of  this  Congress,  and  has  been  mentioned  with 
others  in  the  resolutions  here.  I  never  knew  Mr.  Hathaway  until 
about  ten  days  ago.  I  hadn't  taken  any  particular  interest  in  the 
proposed  World's  Insurance  Congress.  I  had  been  selected  by  the 
American  Bar  Association  to  represent  them  in  the  National 
Council  of  the  Congress,  and  thereafter  had  been  requested  to 
prepare  a  paper  on  the  American  lawyer,  and  came  out  here  with 
no  particular  interest  in  this  Congress. 

"While  here,  however,  I  have  been  most  profoundly  impressed 
with  the  idea  that  what  has  been  accomplished  here  this  week  is 
due  to  the  efforts  of  one  individual,  and  in  saying  that  I  am  not 
minimizing  what  has  been  done  by  others  or  whatever  may  be 
done  by  others,  but  I  am  quite  sure  in  my  own  mind  that  these 
World's  Insurance  Congress  Events  would  not  have  been  accom- 
plished without  Mr.  Hathaway. 

"I  will  not  attempt  to  say  all  that  is  in  my  mind  about  him. 
I  think  he  is  a  Napoleon  in  organization,  in  ability,  in  pertinacity, 
in  determination,  only  hid  genius  has  been  applied  to  the  arts  of 
peace  instead  of  war.  He  has  been  inspired  with  the  loftiest  and 
most  exalted  ideals  about  your  institution  of  insurance.  Plis  work 
in  this  behalf,  which  has  covered  a  number  of  years,  and  has  been 
done  in  spite  of  many  obstacles,  has  been  inspired  solely  with  a 
disinterested  motive.  I  am  quite  certain  that  he  has  had  no  idea 
of  grinding  any  axe  of  his  own,  of  any  individual,  of  any  insur- 
ance company,  or  of  any  insurance  man.  I  desire  to  put  the 
matter  before  the  National  Council,  and  offer  a  testimonial  of 
our  appreciation  of  the  services  of  AV.  L.  Hathaway." 


WORLD'S  INSURANCE  CONGRESS  59 

At  the  conclusion  of  Mr.  Vory's  remarks,  a  motion  was  offered 
by  George  I,  Cochran,  seconded  by  William  G.  Wilson,  and  un- 
animously carried,  that  he  be  requested  to  prepare  a  suitable 
resolution  in  accord  with  the  substance  of  his  remarks,  to  voice 
the  appreciation  of  the  World's  Insurance  Congress  of  the  invalu- 
able service  of  Mr.  Hathaway. 

[The  resolution  drafted  by  Mr.  Vorys  imll  he  found  on  page 
430.] 

Mr.  Hathaway  very  briefly  and  gi-atefully  acknowledged  the 
tribute  paid  him  by  the  members  of  the  National  Council,  after 
which  the  meeting  adjourned. 

End  of  the  Sixth  Day's  Proceedings 


MONDAY,  OCTOBER  IITH,  1915 

world's  insurance  congress  peace  day 

Insurance  in  its  relationship  to  world  peace  was  the  theme  of 
those  who  spoke  on  Monday,  October  11th,  1915 — the  seventh  day 
of  the  World's  Insurance  Congress,  and  the  first  of  the  four  spe- 
cial days  celebrated  within  the  Exposition  Grounds. 

Many  of  the  peace  advocates  of  the  country,  under  the  leader- 
ship of  Dr.  Jordan,  had  seen  the  great  possibilities  of  international 
insurance  as  an  instrument  for  future  harmony  between  nations, 
and  availed  themselves  of  this  opportunity  to  place  the  cause  of 
peace  before  the  insurance  influences  of  the  country  through  the 
medium  of  the  World's  Insurance  Congress. 

Two  of  the  papers  presented  on  this  day,  combined  with  the 
remarks  of  the  Chairman  of  the  morning  session,  Mr.  Rolla  V. 
Watt,  Manager  of  the  Royal  and  Queen  Insurance  Companies,  so 
well  succeeded  in  the  general  effort  of  the  occasion  that  to  repro- 
duce more  would  be  superfluous. 

Professor  Josiah  Royce,  of  Harvard  University,  a  member  of 
the  Peace  Committee  of  the  World's  Insurance  Congress,  while 
unable  to  be  present  in  San  Francisco  personally,  presented  to 
the  Chairman  of  the  day  a  paper  expressive  of  his  views  upon 
the  subject  of  International  Insurance. 

Dr.  David  Starr  Jordan,  Chairman  of  the  Peace  Committee  of 
the  World's  Insurance  Congress,  who  also  served  as  Chairman  of 
the  afternoon  session  of  this  day,  delivered  an  address  upon  "War, 
Business  and  Insurance." 

[The  addresses  of  Mr.  Watt,  Professor  Royce  and  Dr.  Jordan 
will  he  found  on  pages  343,  344,  and    350,  respectively.] 

End  of  the  Seventh  Day's  Proceedings. 


60  WORLD'S  INSURANCE  CONGRESS 


TUESDAY,  OCTOBER  12TH,  1915 

life  conservation  day 

Opening  Address:     Presentation  of  Medal  to  Life  Extension 

Institute  by  AV.  L.  Hathaway,  Commissioner,  World's 

Insurance  Congress  Events 

"Ladies  and  Gentlemen:  Before  introducing  the  Chairman  of 
the  day,  1  will  make  a  brief  explanation  of  the  significance  of  the 
parade  and  the  other  elements  that  will  enter  into  this  day 's  cere- 
monies. 

"Life,  the  most  precious  thing  to  the  human  race,  and  to  each, 
of  us  individually,  is  perhaps  given  the  least  consideration  in  its 
conservation  and  care.  A  strange  thing  that  it  should  be  so,  but 
it  is.  As  individuals,  and  as  a  nation,  we  do  not  take  that  care 
of  ourselves  which  we  ought  to ;  but  now,  with  many  of  the  big 
forces  that  are  being  called  into  being  throughout  this  nation, 
that  is  coming  to  be  no  longer  true.  Few  of  us  fully  realize  the 
extent  to  which  great  national  forces  are  working  for  the  conserva- 
tion and  constant  lengthening  of  the  human  life. 

"The  gentleman  who  will  act  as  Chairman  here  to-day,  whom  I 
will  shortly  introduce,  is  perhaps  the  national  authority  upon 
that  subject,  being  at  the  head  of  a  great  national  organization 
with  many  men  of  national  reputation  on  his  Board  of  Directors, 
and  in  the  direct  support  of  his  institution. 

"Before  introducing  this  gentleman,  who  can  tell  you  more 
about  that  subject  than  I  can,  I  wish  to  say  a  few  words  regarding 
an  element  of  this  parade  that  I  feel  we,  as  citizens  of  San  Fran- 
cisco, should  on  this  day  give  deep  consideration  to,  and  that  is 
the  United  States  Army  and  Navy,  and  our  police  force,  that  en- 
tered into  this  parade.  We  too  seldom  realize  that,  after  all,  their 
great  mission  is  that  of  conservation  and  care  of  human  life. 
It  is  too  much  of  a  popular  thing  for  us  to  believe  that  the 
United  States  Army  is  a  destructive  element,  but  to  thoughtful 
people  I  am  confident  the  realization  will  come  home  that  their 
greatest  work  is  that  of  conservation.  In  the  case  of  San  Francisco, 
there  is  no  place  on  earth  that  can  realize  it  more  fully  than  here. 
After  our  great  disaster,  where  would  our  lives  and  property  have 
been  in  the  hours  and  days  that  followed  that  occasion  if  it  had 
not  been  for  the  United  States  Army  and  Nayy  and  our  police? 

"And  in  other  great  events,  as,  for  instance,  when  the  United 
States  undertook  to  clean  up  the  unsanitary  conditions  at  Havana 
and  other  Cuban  cities,  to  whom  did  they  Look !  To  the  TTnited 
States  Army.  And  when  Galveston  was  left  a  post-hole  after  its 
great  disaster,  it  was  the  United  States  Army  that  took  charge 
and  put  it  back  on  a  livable  basis.  It  was  the  same  in  the  Philip- 
pine Islands ;  and  perhaps  one  of  the  greatest  triumphs  of  the  age 


WORLD'S  INSURANCE  CONGRESS  61 

in  science,  in  carrying  out  the  purification  of  the  Canal  Zone,  it 
has  been  the  United  States  Army  that  has  entered  into  and  com- 
pleted the  work. 

"And,  Ladies  and  Gentlemen,  I  hope  that  to-day  will  start  at 
least  a  small  measure  of  appreciation  that  will  grow  into  a  full 
understanding  on  our  behalf  that,  whenever  we  see  the  uniform 
of  the  United  States  Army  or  Navy,  we  will  look  upon  it  as  our 
protection,  not  only  in  time  of  war,  but  in  time  of  peace,  because 
it  is  contributing  to  our  comfort  and  happiness  and  the  possibili- 
ties of  our  living  under  the  right  conditions  every  hour  of  the  day, 
and  perhaps  to  a  greater  extent  than  any  other  force  that  enters 
into  our  entire  scheme  of  life. 

"We  have  here  a  gentleman  who  will  act  as  General  Chairman 
of  this  gathering  to-day.  He  is  at  the  head  of  an  institution  that 
is  rapidly  becoming  national  in  its  scope  and  already  is  conferring 
benefits  upon  the  human  race  in  the  way  of  life  conservation  work 
that  is  probably  very  little  understood  by  many  of  us — Mr.  E.  E. 
Rittenhouse,  President  of  The  Life  Extension  Institute,  Incorpo- 
rated, from  New  York,  who  is  here  to-day  the  honored  guest  of 
this  occasion,  and  will  act  as  General  Chairman.  But  before  giv- 
ing you  the  floor,  Mr,  Rittenhouse,  I  want,  on  behalf  of  the  Presi- 
dent and  Directors  of  this  Exposition,  to  present  to  you  this  medal^ 
to  commemorate  this  occasion,  that  you  may  take  it  back  to  your 
institution  as  a  lasting  memory,  we  hope,  of  the  honors  we  have 
endeavored  to  confer  upon  you  and  the  useful  institution  of 
which  you  are  the  head." 

[The  address  of  Mr.  Bittenhouse  will  he  foimd  on  page  361.] 

Presentation  of  Exposition  Scroll  to  Alvin  E.  Pope  by  Willard 
Done,  Member,  Executive  Committee,  World's  Insurance 

Congress 

"Mr.  Chairman,  Ladies  and  Gentlemen:  The  officers  of  this 
great  Exposition  wisely  established  a  Department  of  Education 
and  Social  Economy,  and  this  Department,  under  the  efficient 
direction  of  its  head,  has  done  splendid  service  in  economic  and 
educational  lines ;  has  brought  together  the  elements  which  con- 
tribute to  education  and  social  economy,  organized  those  forces, 
and  made  them  potent  means  of  advancing  the  two  elements  which 
enter  into  the  work  of  his  department. 

*  *  So  well  has  he  done  this  work  that  the  Exposition  officials  have 
deemed  it  fitting  to  give  him  official  recognition  on  this  occasion. 
It  is  appropriate  that  this  recognition  should  be  given  on  this 
day,  when  the  greatest  element  of  social  economy,  and  one  of  the 
greatest  elements  of  education,  is  receiving  recognition — the  con- 
servation of  human  life. 

"The  honor  has  been  conferred  upon  me  to  represent  President 
Moore  and  the  Board  of  Directors  of  this  Exposition  in  extending 
to  the  head  of  this  Department  of  Education  and  Social  Economy 


62        WORLD'S  INSURANCE  CONGRESS 

official  recognition  to-day.  To  Alvin  E.  Pope,  the  head  of  this 
Department,  it  is  my  pleasure  to  present  this  certificate  of  the 
appreciation  and  esteem  in  which  he  is  held  by  the  Exposition  offi- 
cials, and  I  echo  it  personally  as  well. 

"I  am  taking  the  liberty  of  introducing  Mr.  R.  W.  Osborn, 
President  of  the  Board  of  Fire  Underwriters  of  the  Pacific,  who 
has  a  few  words  to  say." 

Presentation  of  Loving  Cup  to  Alvin  E.  Pope  by  R.  W.  Osborn 

"Ladies  and  Gentlemen:  As  an  apostrophe  to  that  which  has 
just  preceded,  we  would  feel  remiss  if  on  this  occasion  we  did 
not  express  our  gi-atitude  to  the  Chief  of  the  particular  depart- 
ment presiding  over  the  educational  features  of  this  Fair.  Un- 
derwriting in  all  of  its  phases  has  groped  for  many  years  for 
recognition  in  the  great  economic  work  of  the  world.  We  have  felt 
that  as  time  has  gone  on  it  has  been  too  little  recognized  as  one 
of  the  great  economic  factors  in  the  education  of  the  people,  the 
conservation  of  life,  and  too  little  consideration  has  been  given 
to  the  protective  cloak  which  it  spreads  over  life  and  property. 

' '  That  being  in  view,  we  desire  to  exemplify  the  feeling  we  have 
for  Mr.  Pope  on  this  particular  occasion,  because  it  was  to  him 
we  have  looked  and  must  look  for  such  recognition  in  this  Exposi- 
tion, and  most  especially  in  regard  to  our  exhibits  in  the  educa- 
tional department  of  the  Fair. 

"Not  until  some  few  years  ago  was  underwriting  in  its  various 
phases  recognized  as  a  proper  part  of  the  curricula  of  our  col- 
leges. Yale  instituted  it  with  a  series  of  lectures  upon  that  sub- 
ject, and  more  recently  the  University  of  California  did  likewise, 
in  which  addresses  were  made  by  those  who  formed  a  part  of 
that  great  business  and  institution. 

"It  is  a  long  stretch  from  the  time  when  Plato  commenced  to 
discover,  or  rather  talk  about,  Social  Economy,  up  to  the  present 
time;  but  as  Buddha  has  said:  'Life  is  as  transitory  as  the  sound 
of  the  lyre'  and  we  realize  that  in  our  profession  perhaps  more 
than  anywhere  else.  Therefore,  in  the  culmination  of  that  ambi- 
tion, the  bringing  together,  the  power  to  exhibit  as  a  national 
institution  of  conservation  in  this  Congress  the  great  interests  of 
underwriting,  we  feel  indebted  to  Mr.  Pope  for  having  fully  en- 
dorsed the  idea  and  made  its  fruition  possible.  It  is  therefore 
my  pleasure,  on  behalf  of  the  underwriting  interests— life,  fire, 
marine,  casualty,  and  all  interest,  to  present  to  Mr.  Pope  this 
loving  cup.  Mr.  Pope,  we  desire  that  you  accept  this  on  behalf 
of  the  underwriters,  and  that  you  will  receive  it  as  an  expression 
of  the  sentiments  that  I  have  uttered  only  too  poorly." 

Acceptance  of  Scroll  and  Cup  by  Alvin  E.  Pope 

"Ladies  and  Gentlemen:  I  don't  know  what  to  say.  This  is 
certainly  a  surprise.     The  first  part  on  the  program  was  not  a 


WORLD'S  INSURANCE  CONGRESS  63 

surprise,  because  the  Exposition  always  presents  the  head  of  every 
department  with  a  memorial,  but  to  be  presented  with  a  loving 
cup  by  exhibitors  in  the  Department  is  something  I  did  not  ex- 
pect on  this  occasion,  and  I  appreciate  it  beyond  any  words  I  could 
express  now,  and  I  will  reserve  my  talk  of  appreciation  until  the 
close  of  this  program,  so  as  not  to  interfere  with  the  general 
program  of  the  day." 

Special  Chairman  Introducing  Dr.  Frederick  L.  Hoffman 

"We  will  now  proceed  with  the  program,  which  includes  three 
or  four  brief  but  interesting  and  instructive  addresses  from  men 
prominent  in  their  especial  fields.  The  gentleman  who  will  now 
address  you  is  of  international  renown  in  the  insurance  and  edu- 
cational world.  In  addition  to  being  an  authority  on  the  science 
of  insurance,  he  has  been  for  many  years  a  close  student  of  what 
we  my  call  human  welfare  work,  and  he  is  the  personal  represen- 
tative on  this  occasion  of  the  distinguished  President  of  the  Com- 
pany which  he  represents.  I  have  pleasure  in  presenting  Dr. 
Frederick  L.  Hoffman,  Statistician  of  the  Prudential  Insurance 
Company  of  America,  who  will  address  you  on  the  subject  of  insur- 
ance and  life  conservation." 

[The  address  of  Dr.  Hoffman  mill  be  found  on  page  365.] 

Special  Chairman  Introducing  Dr.  C,  C.  Pierce 

"Before  introducing  the  next  speaker,  I  would  like  to  say  one 
word.  So  far  as  I  am  informed,  this  is  the  first  time  in  the  his- 
tory 'of  great,  world-wide  movements  to  conserve  human  life,  that 
the  Army  and  Navy  and  the  police  force  of  our  country  have  been 
represented  in  such  demonstrations.  I  personally  belong  to  that 
class  of  Americans  who  believe  that  the  Army  and  Nav;^^  are  real 
life  savers  as  well  as  liberty  savers,  and  on  behalf  of  this  meeting 
and  as  one  of  the  representatives  of  the  health  conservation  move- 
ment, I  want  to  convey  my  personal  thanks  to  Col.  Foote,  Com- 
mander of  the  troops,  and  to  the  Commander  of  the  Naval  escort, 
and  if  he  is  not  here,  I  will  suggest  that  the  Commissioner  write 
the  Admiral  a  letter  of  thanks.  And  this  also  goes  to  your  superior 
officers.  Col.  Foote,  and  I  wish  you  would  convey  to  them  our 
sincere  appreciation.  We  also  are  under  great  obligations  to  those 
who  took  part  in  this  parade  and  helped  to  make  it  a  success; 
and,  I  may  add,  to  Dr.  Hoffman  and  other  speakers,  some  of  whom 
have  come  a  great  distance  to  assist  in  this  program. 

"The  fame  of  the  American  Public  Health  Service  is  world 
wide.  Its  extraordinary  achievements,  at  home  and  in  the  tropics, 
are  a  source  of  pride  to  every  citizen  under  our  Government.  No 
health  organizations  in  the  world  have  rendered  such  valuable  and 
permanent  aids  to  humanity  as  ours.  The  next  speaker  represents 
this  service.     He  has  served  with  marked  ability  in  the  United 


64        WORLD'S  INSURANCE  CONGRESS 

States  and  in  tlie  Insular  possessions,  and  is  the  official  represen- 
tative on  this  occasion  of  Dr.  Rupert  Blue,  Surgeon  General  of  the 
United  States  Public  Health  Service.  I  take  great  pleasure  in 
introducing  Dr.  C.  C.  Pierce,  Senior  Surgeon  with  the  United 
States  Public  Health  Service." 

[The  address  of  Dr.  Pierce  will  he  found  on  page  386.] 

Special  Chairman  Introducing  Alvin  E.  Pope 

"We  have  two  more  very  brief  and  very  interesting  addresses. 
We  have  been  told  that  this  is  the  first  Exposition  to  recognize 
insurance  as  a  factor  in  social  economy.  It  is,  therefore,  very  de- 
sirable that  we  should  hear  from  the  gentleman  who  has  had  com- 
mand of  that  department  of  the  Exposition.  I  have  the  honor  of 
introducing  Alvin  E.  Pope,  Chief  of  the  Department  of  Education 
and  Social  Economy  of  this  Exposition. 

[The  address  of  Mr.  Pope  will  he  found  on  page  394.] 

Special  Chairman  Introducing  Dr.  Harry  M,  Sherman 

"Physicians  are  not  only  leading  individually  in  the  work  of 
health  conservation,  but  the  medical  societies  have  commenced  to 
assist  in  spreading  knowledge  of  healthful  living  and  to  stimulate 
interest  in  that  cause.  We  have  already  heard  from  the  National 
Public  Health  Service.  It  is  now  our  pleasure  to  listen  to  a  dis- 
tinguished representative  of  the  family  physician  and  the  medical 
profession  generally.  We  are  honored  in  having  on  our  program 
Dr.  Harry  M.  Sherman,  President  of  the  California  Association 
for  the  Study  and  Prevention  of  Tuberculosis." 

[The  address  of  Dr.  Sherman  will  he  found  on  page  396.] 

Special  Chairman  Closing  Ceremonies 

"This,  Ladies  and  Gentlemen,  concludes  the  progi-am  for  the 
day.    We  thank  you  for  your  coming,  and  for  your  attention. 

[The  address  of  Miles  M.  Dawson,  consulting  actuary,  on  Life 
Conservation  and  Social  Economy,  which  was  scheduled  for  this 
session,  was  not  read.    It  will  he  found  on  page  402.] 

End  of  Eighth  Day's  Proceedings. 


WEDNESDAY,  OCTOBER  13TH,  1915 

FIRE    elimination    DAY 

Opening  Address  by  AVillard  Done 

"Ladies  and  Gentlemen:    The  gathering  which  I  see  before  me, 
assembled  here  for  the  purpose  of  taking  part  in  exercises  in  con- 


WORLD'S  INSURANCE  CONGRESS  65 

nection  with  one  of  our  great  conservation  movements — the  saving 
of  life  and  property  from  the  ravages  of  fire,  is  a  very  inspiring 
sight,  and  I  trust  indicative  of  the  interest  being  taken  in  this  great 
movement  by  fire  insurance  men  and  by  the  general  public. 

*'I  have  been  requested  to  act  as  Chairman  of  this  meeting, 
and,  therefore,  without  further  ceremony  will  introduce  the  rep- 
resentative of  President  Charles  C.  Moore  and  the  Board  of  Direc- 
tors of  this  Exposition,  in  the  person  of  W.  L.  Hathaway." 

Address  and  Presentation  of  Medal  to  National  Fire  Protec- 
tion Association  by  W.  L,  Hathaw^ay 

"Ladies  and  Gentlemen:  Honored  Guests:  It  is  given  to  very 
few,  comparatively,  to  become  known  nationally  for  any  useful 
purpose  that  they  have  contributed  to  the  betterment  of  the  human 
race ;  but  to  be  a  national  figure  in  a  work  as  important  as  that  of 
fire  prevention,  to  be  at  the  head  of  a  great  national  organization 
whose  activities  are  devoted  to  lessening  what  is  termed,  and  rightly 
so,  the  greatest  national  waste  (it  is  put,  I  believe,  in  the  minds 
of  economists  as  the  greatest  waste  of  this  nation — the  greatest 
waste  as  compared  with  the  same  wastes  that  are  going  on  in  other 
leading  countries  of  the  world)  is  an  exceptional  honor.  There 
is  an  association  in  this  country  devoted  to  fire  prevention  which 
has,  according  to  statistical  facts  that  have  come  before  me,  the 
greatest  opportunity  for  future  good  to  the  people  of  this  nation 
of  perhaps  any  activity  in  which  any  body  of  men  is  engaged ;  and 
the  gentleman  who  is  here  to-day  as  the  representative  of  that 
great  national  organization  has  become  truly  a  national  figure.  He 
is  known  for  the  work  that  he  individually  has  performed  and  for 
the  lessons  that  he  has  been  instrumental  in  teaching  the  Ameri- 
can public  as  to  the  ways  that  they  can  better  conserve  and  pre- 
vent this  great  national  waste.  So  without  much  preliminary, 
Ladies  and  Gentlemen,  I  am  going  to  introduce  to  you  the  gentle- 
man who  heads  that  great  national  movement,  and  who,  as  the 
representative  of  the  President  of  this  Exposition,  I  am  proud  to 
welcome  here  to  our  City,  and  to  present  to  him  on  behalf  of  this 
Exposition  this  medal,  for  him  to  take  back  to  his  association  in 
memory  of  this  occasion,  and  as  a  small  expression  of  the  esteem 
that  this  Exposition  has  for  both  himself  personallj^  and  the  great 
association  which  he  represents  and  the  work  it  is  performing. 
Ladies  and  gentlemen,  I  will  introduce  to  you  Mr.  Franklin  H. 
Wentworth,  the  head  of  the  National  Fire  Protection  Association ; 
and  Mr.  Wentworth,  on  behalf  of  the  President  and  Directoi-s  of 
this  Exposition,  I  present  to  you  this  memorial  of  this  occasion. ' ' 

Acceptance  of  Medal  and  Address  by  Franklin  H.  Wentworth 

"Mr.  President,  Ladies  and  Gentlemen:  I  am  exceedingly  ap- 
preciative of  his  honor,  and  it  will  give  me  sincere  pleasure  on  my 


66        WORLD'S  INSURANCE  CONGRESS 

return  to  Boston  to  present  to  the  executives  and  ofificers  of  the 
National  Fire  Protection  Association  this  testimonial  of  the  ap- 
preciation of  the  Exposition  authorities  for  the  work  which  the 
National  Fire  Protection  Association  has  done  in  the  twenty  years 
of  its  life. 

"Now,  nothing  would  please  me  better  than  to  speak  at  some 
length  on  the  subject  of  fire  prevention  and  protection,  but  we 
have  an  objective  program  arranged  for  to-day,  and  so  I  will  defer 
that  opportunity  for  speaking  to  some  later  chance  in  San  Fran- 
cisco. 

"On  the  Marina  has  been  built  a  two  stoiy  building.  The  lower 
part  of  that  building  represents  a  grocery  store,  the  upper  part 
represents  a  dwelling  place.  At  three  o'clock — fifteen  minutes 
from  now — this  two  story  house  will  be  set  on  fire.  A  still  alarm 
will  be  given  to  the  salvage  corps.  Many  of  you  Ladies  and  Gen- 
tlemen perhaps  do  not  understand  what  the  salvage  corps  is;  but 
it  is  a  corps  of  men  maintained  by  the  insurance  companies  which 
goes  to  every  fire  and  covers  the  perishable  stock  with  tarpaulin 
or  canvas  to  save  great  water  damage.  This  salvage  corps  will 
respond  to  this  still  alarm,  will  come  to  the  house  and  will  cover 
the  goods  in  the  lower  story.  Then  while  the  upper  story  is  burn- 
ing the  alarm  will  be  turned  in  and  the  fire  department  in  the 
Exposition  will  respond  and  will,  of  course,  turn  the  water  on  the 
fire  and  we  hope  extinguish  it  before  the  building  is  completely 
consumed.  With  the  high  reputation  which  the  San  Francisco 
Fire  Department  has  for  efficiency,  I  have  almost  no  doubt  that 
the  fire  will  be  extinguished. 

"Then,  at  four  o'clock,  before  the  fire  station  on  the  Zone, 
there  will  be  given  an  exhibition  of  life  saving  by  the  firemen  of 
that  station, 

"I  neglected  to  say  that  the  fire  boat  will  also  respond  to  this 
alarm  and  you  can  observe  it  in  action  off  the  jMarina.  Then,  at 
8  o'clock  to-night,  the  fire  boat  will  again  give  a  demonstration 
off  the  Marina,  and  the  colored  lights  of  the  Exposition  battery 
will  play  on  the  streams  coming  from  the  boat. 

"There  are  just  one  or  two  other  items  on  the  program,  and  in 
order  to  adjourn  on  time  I  will  now  conclude  my  remarks  by  thank- 
ing you  for  coming  here  to-day  and  hoping  that  you  will  enjoy 
the  spectacle  which  the  gentlemen  of  the  Fire  Elimination  Day 
Committee  have  prepared  for  you." 

Chairman  Introduces  W.  L.  Hathaway 

"Mr.  Hathaway  will  officiate  in  the  presentation  of  another 
medal,  and  then  we  will  adjourn  promptly  for  the  other  exercises." 

Presentation  of  Medal  to  Fire  Patrol  by  W.  L.  Hathaway 

"Ladies  and  Gentlemen:    There  is  a  body  outside  of  the  official 

city  organization— a  body  of  men  maintained  by  the  insurance  com- 


WORLD'S  INSURANCE  CONGRESS  67 

panics — who  do  very  effective  work  in  a  most  unselfish  way  in 
the  prevention  of  a  great  deal  of  fire  waste.  This  body  is  known 
as  the  San  Francisco  Fire  Patrol  and  is  one  more  illustration  of 
the  great  eflt'orts  made  by  insurance  companies  themselves  to  do 
more  than  merely  act  as  the  agents  of  indemnity;  and  it  is  our 
pleasure  and  honor  to-day  to  present  to  them  a  similar  recogni- 
tion. I  will  ask  Mr.  Osborn  to  take  to  them  the  regards  of  this 
Exposition,  and  this  medal,  that  they  may  keep  it  as  a  souvenir 
of  such  regard." 

Acceptance  op  Medal  for  Fire  Patrol  by  R.  W.  Osborn 

"Ladies  and  Gentlemen:  As  President  of  the  Board  of  Fire 
Underwriters  of  the  Pacific  I  have  been  asked  to  accept  this  medal 
for  the  Fire  Patrol,  and  will  do  so  very  briefly.  Quite  apart 
from  the  question  of  conservation  of  life  is  that  greater  ques- 
tion— because  it  becomes  more  multitudinous — the  conservation  of 
property.  The  Fire  Patrol  of  San  Francisco  is  an  unique  organiza- 
tion, and  one  with  which  many  of  you  are  not  at  all  familiar.  It 
is  supported  wholly  by  the  fire  insurance  companies.  Its  prime 
object  is  to  prevent,  as  far  as  possible,  the  useless  destruction  of 
property  by  water  damage. 

"The  organization  known  as  the  Fire  Patrol  has  a  wonderful 
mechanism,  a  wonderful  organization,  and  has  to  its  credit  the 
preservation  of  more  property  than  any  similar  organization  in 
the  world.  The  Fire  Patrol  responds  promptly  to  every  call  of 
fire  within  the  business  district  of  the  city,  and  that  Patrol  reaches 
the  fire  quite  often  before  the  Fire  Department  itself  and  exerts 
its  wonderful  influence  against  further  damage  by  stretching  tar- 
paulin and  canvas  covers  over  exposed  property.  The  Fire  Patrol 
is  one  that  will  be  exhibited  to  you  in  its  operative  work  on  the 
Marina  this  afternoon  directly  after  this  meeting,  and  I  wish  to 
second  the  invitation  of  Mr.  Wentworth  for  you  all  to  go  over 
and  witness  the  demonstration  which  he  has  explained. 

"On  behalf  of  the  officers  of  that  Patrol,  and  those  in  its  admin- 
istrative work,  I  wish  to  thank  the  officials  of  the  Exposition  for 
the  opportunity  extended  to  receive  this  medal,  and  I  will  place 
it  before  them,  when  I  know  they  will  greet  it  with  a  great  deal 
of  pleasure. ' ' 

Chairman  Closing  Meeting 

"That  completes  the  exercises  of  the  day.  The  audience  is 
requested  to  proceed  to  the  Marina,  where  the  exhibition  will 
occur." 

End  of  the  Ninth  Day's  Proceedings 


68  WORLD'S  INSURANCE  CONGRESS 

THURSDAY,  OCTOBER  14TH,  1915 

"safety  first:"  accident  prevention  day 

Opening  Address  by  E.  0.  McCormick 

"Ladies  and  Gentlemen:  There  is  no  one  here  to  introduce  me. 
My  name  is  McCormick.  I  couldn't  get  any  one  to  officiate  here. 
It  puts  me  in  mind  of  Dreamland  Park,  where  when  you  want  to 
introduce  a  man  you  take  him  by  the  glove  and  say  '  He  challenges 
the  world.'  I  am  just  taking  you  all  by  the  left  glove,  because 
that  is  nearest  the  heart,  and  saying  'We  challenge  the  world.' 
And  now  I  am  going  to  introduce  the  Honorable  Willard  Done, 
for  the  Exposition  Board,  who  holds  the  medal." 

Address  and  Presentation  of  Medal  to  Workmen's  Compen- 
sation Service  Bureau  by  Willard  Done 

* '  Mr.  Chairman,  Ladies  and  Gentlemen :  I  hold  the  medal  tem- 
porarily, in  which  respect  I  am  somewhat  like  the  little  Jewish 
boy  that  is  told  of  in  a  story.  The  boy  had  been  very  faithful 
in  the  performance  of  his  duties  in  his  father's  store,  and  one 
morning  at  opening  time  the  father  came  and  said  'Ikey,  you  have 
been  a  very  good  boy,  and  done  the  chores  and  run  errands,  and 
been  just  fine.  Here  is  a  dollar — a  whole  dollar — and  you  can 
keep  that  dollar  all  day,  and  you  don't  need  to  give  it  back  to 
me  until  to-night.'     So  in  that  respect,  I  hold  the  medal. 

"It  affords  me  very  great  pleasure  to  be  able  to  officiate  in  this 
humble  capacity  on  the  present  occasion.  It  is  only  recently  that 
insurance  companies,  and  the  general  public,  have  come  to  a 
realization  that  there  are  certain  calamities  that  cannot  be  prop- 
erly indemnified.  We  may  give  a  very  poor  substitute,  but  it  is 
only  a  poor  substitute.  Human  life  and  human  limb  are  the  price- 
less possessions  which,  once  lost,  cannot  be  substituted  by  anything, 
or  replaced.  We  may  give  money  to  take  the  place,  in  part,  of  the 
wage  earner  who  is  taken  away  by  death  or  maimed  by  accident, 
but  that  money  which  is  given  is  only  a  poor  substitute  for  that 
which  modern  society  has  come  to  recognize  as  the  most  important 
and  valuable  thing  that  the  human  race  possesses,  namely,  life, 
limb  and  health.  Therefore,  it  has  come  to  be  regarded  as  a  pai-a- 
mount  duty  of  society,  of  insurance  companies,  of  corporations, 
of  the  employers  of  labor,  to  do  everything  in  their  power  to  pre- 
vent the  calamity  instead  of  waiting  until  it  has  occurred  and  then 
attempting  to  indemnify  those  who  suffer  by  it.  From  this  has 
arisen  the  great  'Safety  First'  movement  for  accident  prevention, 
the  great  movement  for  life  consei*A^ation,  the  great  movement  for 
fire  elimination — all  of  which  movements  have  had  their  special 
days  here  in  connection  with  the  World's  Insurance  Congress,  the 


WORLD'S  INSURANCE  CONGRESS  69 

last  being  given  to-day  in  honor  of  accident  prevention  and  Safety 
First. 

"It  is  thought  to  be  so  much  better — so  much  more  human — to 
give  to  a  man  his  life  and  limb,  his  safety,  by  keeping  him  away 
from  preventable  accidents,  than  to  give  to  his  widow  if  he  is 
killed,  or  to  him  if  he  is  maimed,  a  very  poor  indemnity  in  the 
way  of  money,  and,  therefore,  it  follows  that  the  brains  of  the 
best  men  of  this  country  are  now  being  devoted  to  the  idea  of  pre- 
venting accidents. 

' '  Therefore,  it  is  a  fitting  thing  that  one  of  the  organizations  of 
the  country  which  has  been  the  most  active  in  this  direction  should 
be  espeeiallj^  honored  here  to-day.  I  have  a  medal  which  is  en- 
graved in  the  name  of  this  organization — the  Workmen's  Compen- 
sation Service  Bureau.  This  Bureau  has  taken  a  nation-wide  and 
world-wide  interest  in  the  prevention  of  accident — the  Safety  First 
movement.  It  has  given  special  inducements  to  corporations  and 
to  employers  of  labor  to  install  safety  devices.  Those  inducements 
are  in  the  way  of  reduced  premium  rates  for  protection.  There- 
fore, it  is  very  fitting  that  I  should  present  to  the  official  represen- 
tative here  to-day  this  medal,  and  to  Mr.  Charles  H.  Holland,  who 
represents  this  organization,  I  have  much  pleasure  in  delivering 
it." 

Special  Chairman  Introducing  Charles  H.  Holland 

"Mr.  Holland,  Ladies  and  Gentlemen,  is  the  General  Manager 
of  the  Royal  Indemnity  Company,  and  is  from  New  York  City.  He 
is  one  of  the  organizers  and  most  active  members  of  the  Work- 
men 's  Compensation  Service  Bureau,  a  central  organization  founded 
by  the  leading  liability  insurance  companies  of  the  United  States 
for  the  collection  of  authentic  statistical  data  pertaining  to  the 
cost  of  industrial  accident  insurance.  The  work  of  the  Bureau  has 
now  broadened  out  into  a  comprehensive  campaign  for  the  pre- 
vention of  industrial  accidents. 

"His  position  as  General  Manager  of  one  of  the  largest  general 
insurance  companies  in  the  United  States,  and  as  a  member  of  the 
Workmen's  Compensation  Service  Bureau,  most  aptly  fits  Mr, 
Holland  to  speak  on  the  subject  'Safety  Work  of  Insurance  Com- 
panies.' Mr.  Holland,  in  acknowledging  the  receipt  of  the  medal, 
will  at  the  same  time  speak  on  the  subject  of  the  safety  work  of 
the  insurance  companies.  I  have  the  honor  to  present  Mr.  Charles 
H.  Holland,  of  New  York,  General  Manager  of  the  Royal  Indem- 
nity Company." 

[The  address  of  Mr.  Holland  tvill  he  found  on  page  410.] 

Special  Chairman  Introducing  L.  E.  Abbott 

"The  next  speaker  is  Mr.  L.  E.  Abbott,  General  Claim  Agent  of 
the  Oregon  Short  Line  Railroad,  of  Salt  Lake  City.    He  will  talk 


70        WORLD'S  INSURANCE  CONGRESS 

of  the  safety  work  of  railroads.  Mr.  Abbott,  with  one  other  man, 
policed  the  camps  engaged  in  the  construction  of  the  Lucin  cut- 
off of  the  Southern  Pacific  Company  across  the  Great  Salt  Lake, 
in  Utah,  from  the  commencement  of  the  construction  work  in  1902 
until  its  completion  in  1904.  It  was  on  this  great  engineering  work 
that  his  interest  in  industrial  accident  prevention  was  aroused. 

' '  After  the  completion  of  the  Lucin  cut-off  Mr.  Abbott  associated 
himself  with  the  Oregon  Short  Line  Railroad  Company  in  the 
capacity  of  claims  adjuster,  where  he  continued  his  accident  pre- 
vention work  in  connection  with  his  other  duties,  with  such  good 
results  that  in  1913  he  was  appointed  Safety  Commissioner  of  the 
Oregon  Short  Line  Railroad  Company,  a  position  created  for  the 
purpose  of  educating  both  employees  and  the  public  in  Safety 
First.  Early  in  1915  ]\Ir.  Abbott  accepted  the  position  as  General 
Claim  Agent  of  the  Oregon  Short  Line. 

"I  know  of  no  one  man  in  the  West  who  has  done  more  for 
the  Safety  First  movement.  He  is  an  authority  on  the  subject 
'The  Safety  Work  of  the  Railroads.'  " 

[The  address  of  Mr.  Ahhott  ivill  le  found  an  page  414.] 

Special  Chairman  Introducing  Will  J.  French 

"I  have  great  pleasure  in  introducing  the  Director  of  the  Na- 
tional Safety  Council,  a  member  of  the  California  Industrial  Acci- 
dent Commission,  Mr.  Will  J.  French,  of  San  Francisco.  He 
was  appointed  to  the  California  Industrial  Accident  Commission 
in  1911,  and  prior  to  that  was  prominently  associated  with  or- 
ganized labor  in  San  Francisco.  The  choice  of  the  Governor  of 
California  in  appointing  him  to  the  Accident  Commission  was  ad- 
mirable in  that  Mr,  French  is  intimately  versed  in  the  needs  of  the 
worker.  He  can  speak  on  the  subject  of  'Industrial  Safety'  from 
the  inside  viewpoint,  because  he  knows  what  he  is  talking  about." 

[The  address  of  Mr.  Fretwh  will  fee  foMTid  on  page  420.] 

Special  Chairman  Introducing  Lieut.  Duncan  Matheson 

"The  fourth  and  last  speaker  is  Lieut.  Duncan  Matheson,  whose 
subject  is  'Street  Safety,'  in  which  we  are  all  so  vitally  interested 
at  the  present  time. 

' '  Before  he  entered  the  Police  Department  he  was  a  roadmaster 
on  a  railroad.  His  rise  from  a  patrolman  to  a  detective  sergeant 
was  rapid,  and  achieved  through  merit  alone  and  a  dogged  deter- 
mination to  go  ahead.  He  is  considered  by  the  Police  Commis- 
sioner as  one  of  the  best  officers  in  the  Department. 

"It  was  he  who,  in  1912,  foresaw  the  growing  need  of  an  or- 
ganization in  the  Police  Department  to  take  care  of  the  street  traf- 
fic. It  was  Lieut.  Matheson  who  organized  the  first  traffic  squad, 
and  it  is  through  his  persistent  efforts  that  San  Francisco's  now 


WORLD'S  INSURANCE  CONGRESS        71 

complete  and  efficient  traffic  squad  was  coached  and  drilled  and 
finally  sent  out  to  take  care  of  the  great  tide  of  vehicles  and  pe- 
destrians that  daily  flood  our  business  streets,  and  I  think  there 
is  no  more  complete  or  efficient  squad  in  this  country.  There  isn  't 
anything  in  connection  with  the  movement  of  traffic  in  these 
crowded  thoroughfares  that  he  isn't  entirely  familiar  with.  I 
have  great  pleasure  in  introducing  to  you  Lieut.  Matheson. " 

[The  address  of  Lieut.  Matheson  will  be  found  on  page  423.] 

Chairman  Willard  Done  Making  Announcement 

"I  am  requested  to  announce,  Ladies  and  Gentlemen,  that  there 
will  be  a  special  demonstration  on  the  Marina  immediately  fol- 
lowing these  exercises,  and  you  are  invited  to  go  down  and  witness 
that  demonstration  of  the  Safety  First  movement  in  its  practical 
application." 

General  Chairman  Closing  Meeting 

"This  will  conclude  our  stay  here,  and  if  you  can  find  the  time 
to  join  us  at  the  point  mentioned  we  will  be  delighted  to  have 
you." 

End  of  the  Tenth  Day's  Proceedings 


IV 

ADDRESSES  DELIVERED  AT  THE  WORLD'S 
INSURANCE  CONGRESS 

OPENING  ADDRESS  OF  THE  GENERAL  CHAIRMAN 

Arthur  I.  Vorys 

Chairman  of  the  Committee  on  Insurance  Law  of  the  American 

Bar  Association 

Ladies  and  Gentlemen:  Great  social  movements  usually  are 
proclaimed,  advocated  and  urged  before  they  are  established  and 
accepted  by  the  people.  Insurance,  once  regarded  as  immoral,  a 
gambling  device,  a  hateful  thing  without  public  advantage,  has 
now  become  established  as  an  indispensable  thread  in  the  warp  and 
woof  of  our  social,  commercial  and  industrial  fabric.  The  effort 
now  is  to  make  the  people  realize  they  have  it,  to  have  them  know 
it  is  there,  to  have  them  appreciate  it  and  take  care  of  it. 

The  purpose  of  this  World's  Insurance  Congress  is  not  to  ex- 
ploit any  insurance  company  or  any  class  of  insurance  companies. 
Neither  is  it  to  promote  the  business  of  Insurance.  Its  purpose 
is  to  proclaim,  to  emphasize  and  to  bring  home  to  the  minds  of  all, 
the  prevention,  conservation  and  protection  involved  in  the  now 
essential  fundamental  institution  of  Insurance.  Its  purpose  is 
to  fasten  this  idea,  deep  and  enduring,  in  the  minds  of  those  en- 
gaged in  insurance  and  those  directly  and  vitally  affected  by  it. 

Its  purpose  is  to  bring  home  to  the  minds  of  those  engaged  in 
the  business  of  insurance  that  it  is  a  social  institution,  and  the  pur- 
pose of  this  Congress  is  to  instill  that  idea  universally  and  ever- 
lastingly in  the  minds  of  all  the  people. 

I  am  deeply  sensible  of  the  honor  conferred  upon  me  in  being 
designated  as  Chairman  of  this  Congress,  but  I  am  more  deeply 
impressed  with  the  important  purpose  of  this  Congress  and  the 
part  that  you  and  I  must  take  in  it  in  order  that  it  may  become  the 
institution  which  those  who  have  started  it  hoped  that  it  may. 
There  is  no  place  on  this  program  for  an  address  by  the  Chairman, 
and  I  am  not  going  to  make  a  speech.  I  do  feel,  however,  that 
I  would  not  properly  voice  this  feeling  if  I  did  not  at  the  outset 
call  attention  to  one  particular  matter. 

The  conception  of  such  an  organization  as  this  occurred  four 
or  five  years  ago.     The  idea  was  to  have  this  World's  Exposition 

72 


WORLD'S  INSURANCE  CONGRESS  73 

recognize  Insurance  among  the  important  arts  and  industries  of 
the  Exposition, 

Those  who  promoted  that  idea  were  met  by  the  untoward  cir- 
cumstances that  we  feared  at  the  time  would  thwart  their  plans. 
They  were  indefatigable,  however,  and  you  and  I  and  thousands 
and  hundreds  of  thousands  of  others  are  deeply  grateful  to  all 
those  who  doggedly  pushed  Insurance  as  one  of  the  important  in- 
stitutions to  be  recognized  by  this  World's  Exposition. 

There  are  many  to  whom  we  are  indebted,  but  I  feel  that  all 
voice  this  feeling  when  now  at  the  outset  in  some  way  I  express 
for  you  the  deep  gratitude  and  appreciation  of  all  of  you,  and 
the  hundreds  of  thousands  of  others,  for  the  indefatigable  efforts 
of  William  L.  Plathaway,  the  Exposition  Commissioner  for  the 
World's  Insurance  Congress  Events.  If  the  occasion  were  appro- 
priate and  we  all  had  our  glasses  in  our  hands,  I  would  first  pro- 
pose a  toast  to  the  President  of  the  United  States  and  second  to 
Mr.  Hathaway. 

This  place,  this  spot,  right  here  in  this  gi-eat  hall,  in  the  City  of 
San  Francisco  and  the  State  of  California,  is  the  appropriate 
place  for  this  Congress.  California  is  a  great  state  and  has  many 
important  cities,  but  those  of  us  who  are  spread  across  the  country 
think  of  San  Francisco  as  the  one  great  important  gateway  of  the 
Pacific;  and  there  are  many  of  us  who  thought  at  the  time  of 
that  great  disaster,  when  fire  swept  this  great  City,  that  your 
great  gateway  would  never  again  open  as  it  had  before.  However, 
it  was  due  to  the  institution  of  Insurance  in  its  various  forms  that 
rehabilitation  of  this  beautiful — probably  the  most  beautiful  city 
in  the  country — was  effected,  so  I  say  that  this  City,  in  this  State 
of  California,  is  the  appropriate  place  for  us  to  come. 


ADDRESS  OF  WELCOME 

By  Chester  H.  Rovtell 
Representing  the  Governor  of  California 

Mr.  Chairman,  and  Members  of  the  World's  Insurance  Con- 
gress: I  am  sure  that  the  Governor  of  California  feels  the  regret 
that  you  feel  and  I  feel  that  he  must  appear  here  to-day  only  by 
proxy,  but  for  the  last  few  weeks  those  of  you  who  are  Californians 
know  that  the  Governor  is  occupied  elsewhere,  and  is  at  this  mo- 
ment in  Los  Angeles,  and  it  is  a  physical  impossibility  that  he 
should  be  here  in  person  to  extend  the  greetings  of  the  State. 

I  feel  that  the  Governor  of  California  would  feel  an  especial 
regret  at  not  being  able  to  be  present  at  this  Congress,  because 
its  purpose  is  one  which  is  exceptionally  dear,  not  merely  to  his 
heart,  but  to  the  hearts  of  the  whole  people  of  California.  You 
have  dedicated  this  Congress  to  the  conception  of  insurance  as  a 


74        WORLD'S  INSURANCE  CONGRESS 

social  service,  and  that  is  an  ideal  in  which  California  aspires  to 
take  some  leadership,  and  to  go  hand  in  hand  with  you  in  the 
public  and  private  and  semi-private  partnerships  of  the  various 
elements  which  must  work  together  in  this  great  work  of  social 
progress. 

The  time  was,  as  your  Chairman  has  said,  when  your  business 
was  regarded  as  a  gamble.  The  time  has  come  when  your  business 
is  the  chief  thing  that  prevents  life  from  being  a  gamble.  Your 
business  was  once  almost  the  only  mitigation  of  an  absolute,  ruth- 
less, individualism ;  and  it  was  perhaps  one  of  the  strongest  influ- 
ences that  has  taught  us  that  that  ruthless  individualism  is  no 
longer  good,  either  for  the  individual  or  for  society.  The  risks  of 
life  must  be  distributed,  and  the  service  of  distributing  those  risks' 
is  a  service  not  merely  to  the  individual — thought  that  is  his  per- 
sonal motive  in  taking  out  insurance — still  more  important,  it  is 
a  service  to  society,  and  it  is  a  service  which  is  only  in  its  barest 
beginnings. 

You  know  we  begin  with  the  simplest  and  crudest  things.  We 
began  in  the  criminal  law  with  prohibitions  against  the  simplest 
and  crudest  crimes,  and  we  had  simple  and  crude  punishments  for 
committing  those  crimes,  and  out  of  those  simple  beginnings,  with 
simple  crimes,  has  finally  grown  up  the  whole  complex  structure  of 
the  regulative  law  of  civilized  countries — regulating  not  merely 
crude  crimes  but  subtle  crimes,  and  then  going  on  to  regulate  all 
sorts  of  things  that  are  not  criminal,  until  we  have  gone  on  to  such 
an  important  thing  as  business — to  realize  that  the  great  forces  of 
business  are  so  important  and  so  vital,  and  may  be  forces  for  good 
and  may  be  forces  for  evil,  and,  if  let  alone,  are  usually  a  mixture 
of  both.  And  so  the  forces  of  business,  and  especially  of  your 
business,  have  come  to  be  recognized  as  public  forces  to  be  directed 
for  the  public  weal,  and  that  means  that  not  only  is  your  business, 
as  a  business,  becoming  more  complex,  but  the  relations  of  yonv 
business  to  people,  organized  and  unorganized,  are  becoming  more 
and  more  complex,  and  we  cannot  see  the  end  of  it  except  to  know 
that  it  is  constantly,  gradually  expanding. 

Sometimes  in  my  dreams  I  look  forward  to  a  time  when  the 
world  will  be  so  organized  that  everybody  will  be  insured  against 
everything,  and  when  that  time  comes  it  may  be  that  some  of  the 
departments  of  your  business,  especially  that  department  which  is 
so  to  the  fore  in  the  life  insurance  business — the  department  of 
hypnotism  and  persuasion — will  be  less  needed  than  now.  But  if 
so,  the  talents  that  are  almost  wastefully  utilized,  and  must  be 
wastefully  utilized  in  converting  us  to  our  good,  may  be  more 
economically  utilized  afterwards  in  the  administration  of  that  good 
which  we  will  all  recognize. 

Your  business,  in  its  various  branches,  reminds  us  of  the  fact 
that  human  nature  regards  its  property  with  great  concern,  and 
regards  life  and  limb  with  very  great  carelessness,  and  those  of 
you  in  fire  insurance  do  not  have  to  maintain  anything  like  the 


WORLD'S  INSURANCE  CONGRESS  75 

extensive  departments  of  hypnotism  that  do  those  in  the  life  and 
the  accident  insurance  business,  because  everybody  knows  he  must 
insure  his  property  against  fire,  while  everybody  has  to  be  per- 
suaded with  much  magnetism  to  take  out  death  insurance.  I  hope 
the  time  will  come  when  you  will  all  have  death  insurance,  and 
that  we  will  add  to  it  birth  insurance,  which  we  have  in  part  done, 
ajid  then  we  will  include  between  the  two  ends  of  life  the  insurance 
of  all  the  vicissitudes,  and  after  we  have  birth  insurance  and 
marriage  insurance  and  health  insurance  and  accident  insurance 
and  old  age  insurance,  and  finally  death  insurance  (for  that  is 
what  it  is:  you  call  it  life  insurance,  with  all  your  optimism,  but 
it  really  is  death  insurance),  then  your  business  will  have  covered 
all  of  life,  and  it  won't  be  very  long  until  it  completely  includes 
all  of  those  things. 

It  is  a  pleasure  to  welcome  you  here  to  California,  and  particu- 
larly here  in  this  City,  which  is  the  monument  of  insurance. 

Insurance  can't  produce  anything.  Insurance  couldn't  prevent 
this  City  from  being  destroyed;  and  insurance  couldn't  pay  for 
rebuilding  it.  We  never  get  anything  that  we  don't  pay  for — 
but  the  fact  that  the  cost  of  rebuilding  this  city  could  be  distrib- 
uted over  many  cities,  and  then  re-distributed  back  upon  our- 
selves over  many  years,  made  the  difference  between  possibility 
and  impossibility  in  reconstructing  this  City;  and  the  fact  that 
you  come  here  into  a  city  of  beautiful  buildings  and  people,  in- 
stead of  the  least  romantic  and  beautiful  ruin  that  the  world  ever 
saw — that  you  did  and  for  that  difference,  this  City  and  this 
State  will  hold  you  in  its  remembrance  forever. 


ADDRESS  OF  WELCOME 

By  Arthur  H.  Barendt 
Representing  the  Mayor  of  San  Francisco 

Mr,  Chairman,  Ladies  and  Gentlemen:  To  commence  a  speech 
with  an  apology  is  not  a  good  beginning,  but  fortunately  for  me 
the  Chairman  has  eased  the  way.  You  of  San  Francisco  know  as 
well  as  I  do  the  reason  for  the  Mayor's  absence,  and  while  we  may 
regret  his  absence  here  to-day,  as  we  all  sincerely  do,  and  no  doubt 
you  do,  too,  I  feel  sure  that  the  fact  that  he  is  going  to  be  our 
Mayor  for  four  years  more  is  a  matter  of  such  overwhelming  grati- 
fication to  us  that  we  can  excuse  his  not  coming,  and  even  excuse 
his  sending  me  as  his  representative,  I  will  settle  that  with  him 
afterwards.  I  had  the  pleasure  of  going  around  with  the  Mayor 
during  his  recent  campaign,  and  I  know  that  he  was  thoroughly 
tired  out  at  the  end  of  it,  and  that  the  rest  which  he  is  now  taking 
was  very  badly  needed,  and  so  I  hope  that  you  will  pardon  his 
absence  to-day. 


76        WORLD'S  INSURANCE  CONGRESS 

The  Chairman  of  this  meeting  told  you  that  our  San  Franciscan, 
Mr.  Hathaway,  was  the  gentleman  who  conceived  the  idea  of  this 
Insurance  Congress  at  our  International  Exposition.  It  occurred 
to  me  when  I  heard  that  statement  that  an  Exposition  which  is 
international  in  its  character  would  not  be  complete  if  it  did  not 
include  so  vast  an  industry — an  art,  I  think  your  Chairman 
called  it  also — as  the  business  of  insurance. 

It  would  be  folly  for  me  to  talk  to  you  about  insurance.  It  is 
a  subject  of  which  I  know  next  to  nothing,  but  if  "by  their 
works  ye  shall  know  them,"  then  I  should  be  properly  classed 
as  a  strong  advocate  of  insurance,  because  I  carry  all  the  kinds 
of  insurance  that  a  man  in  my  position  can  carry.  I  have  life 
insurance  and  fire  insurance  and  accident  insurance  and  health 
insurance,  and  if  I  am  ever  so  lucky  as  to  own  a  Ford  I  will  carry 
automobile  insurance;  and  if  I  had  enough  property  to  make  it 
worth  while  for  thieves  to  enter  my  home,  I  would  carry  burglary 
insurance,  for  I  certainly  am  a  very  strong  believer  in  it,  and  I 
venture  to  say  that  the  man  of  to-day  who  doesn't  believe  in  in- 
surance is  a  man  very  seriously  in  need  of  education,  or  if  he  be 
educated,  then  he  is  lacking  in  judgment.  Mayor  Rolph,  himself, 
I  know  is  a  believer  in  insurance.  Mayor  Rolph  was  here  at  the 
time  of  the  fire,  which  was  referred  to  so  eloquently  by  Mr.  Rowell. 
I  am  sure  we  San  Franciscans  can't  hear  the  mention  of  that  great 
catastrophe  without  a  thrill  and  a  shudder.  I  went  through  it 
all,  and  whenever  that  date  is  mentioned,  and  the  picture  of  this 
city  glowing — one  vast  expanse  of  fiery  plain.  North  and  East 
and  South  and  West — there  comes  to  me  a  feeling  of  horror;  but 
there  also  comes  to  me  another  memory — a  pleasant  recollection, 
a  going  down  with  the  policies  of  many  clients  on  many  occasions 
and  meeting  with  the  adjusters,  and  then  being  able  to  go  away 
back  to  my  clients  and  say  "Here  you  are;  here  are  your  checks." 

That  was  a  great  gratification  to  me,  apart  indeed  from  the  mere 
fact  of  having  adjusted  the  insurance.  It  was  the  feeling  of 
having  brought  that  relief  to  people  who  were  so  bitterly  in  need 
of  it,  which  was  only  possible  through  insurance. 

It  is  insurance  which  saved  San  Francisco,  as  has  been  so 
rightly  said  by  ]\Ir.  Rowell,  and  although  I  hope  and  trust  and 
pray  that  never  again  will  such  a  calamity  fall  upon  San  Fran- 
cisco, still  we  cannot  help  feeling  glad  when  the  members  of  this 
great  institution  come  to  this  City  to  hold  their  great  Congress. 

This  is  a  Congress  of  insurance  men.  I  stated  before  that  I 
carried  insurance,  and  I  am  a  very  strong  believer  in  it,  and  one 
of  the  duties  which  I  take  upon  myself  is  to  recommend  to  clients 
who  haven't  take  out  insurance  that  they  do  it.  You  don't  know 
how  long  you  are  going  to  live — when  your  property  is  going  to 
\)xirn — and  yourself  and  your  wife  and  your  children  and  society 
at  large  ought  to  be  protected.  You  don 't  want  yourself  and  yours 
to  become  dependent  upon  the  community.  The  only  safe  way  is 
to  provide  against  such  a  calamity  through  insurance.     All  other 


WORLD'S  INSURANCE  CONGRESS        77 

fortunes  may  disappear.  You  may  be  healthy  to-day;  to-morrow 
your  health  has  taken  wings.  To-day  you  may  have  your  home; 
to-morrow  it  may  be  in  ashes.  But  if  you  provided  life  insurance 
you  may  close  your  eyes  in  peace  and  comfort,  knowing  that  you 
have  done  to  your  family  and  society  that  duty  which  every  man 
owes.  If  you  have  provided  fire  insurance,  another  home  may 
be  yours. 

I  think,  Gentlemen  of  this  Congress,  that  you  are  particularly 
fortunate  in  the  time  you  have  selected.  This  is  our  Indian  Sum- 
mer. This  is  the  time  of  year  of  which  we  San  Franciscans  boast, 
as  far  as  our  weather  is  concerned.  Now  you  get  the  most  charm- 
ing period  of  the  whole  year. 

In  the  name  of  His  Honor,  the  Mayor,  therefore,  I  have  the 
great  pleasure,  and  I  esteem  it  a  great  honor,  to  welcome  you  to 
this,  our  resuscitated  City  by  the  Golden  Gate,  rebuilt,  thanks 
to  the  insurance  men. 


RESPONSE  TO  WELCOME 

By  Darwtcn  p.  Kingsley 
President,  New  York  Life  Insurance  Company 

Mr.  Chairman,  Ladies  and  Gentlemen:  Insurance  is  ordinarily 
regarded  as  a  device  by  which  life,  property  and  business  are 
protected  against  the  vicissitudes  of  time  and  circumstance.  It 
is  much  more  than  that.  It  is  a  destroyer  of  prejudice  and  the 
enemy  of  a  very  dangerous  kind  of  ignorance.  It  appeals  to  the 
mass  feeling,  to  those  impulses  which  foreshadow  the  ultimate 
achievement  of  human  solidarity.  In  its  offices  and  on  its  streets 
the  people  of  all  lands  and  of  all  races  meet  and  mingle  daily. 
It  is  a  world  exposition  whose  doors  never  close. 

Thus  welcomed  to  this  City  of  Dreams,  to  this  epitome  of  all 
that  was  best  in  our  recent  civilization,  insurance  naturally  feels 
itself  no  stranger  and  indeed  flatters  itself  that  whatever  perti- 
nence the  formulas  of  welcome  may  or  may  not  have  on  some 
occasions,  the  proprieties  were  not  transgressed  nor  the  truth  sur- 
passed in  the  fervent  and  eloquent  speeches  of  welcome  just  de- 
livered on  behalf  of  His  Honor  the  Mayor  and  His  Excellency  the 
Governor. 

A  world  exposition  should  reflect  world  conditions;  it  pre-sup- 
poses  worldwide  intercourse;  worldwide  understanding,  and  some 
considerable  degree  of  worldwide  sympathy  and  faith. 

Tested  by  this  rule,  the  Panana-Pacific  International  Exposition 
seems  not  a  real  thing  but  a  resurrection  of  an  earlier  and  better 
age.  It  stands  out  like  a  half-submerged  mountain  peak  mark- 
ing the  spot  where  a  noble  continent  once  was.     It  tells  us  that 


78        WORLD'S  INSURANCE  CONGRESS 

even  in  our  day  men  did  laugh  together,  and  did  love  each  other 
and  did  have  faith. 

This  Exposition,  therefore,  is  more  than  an  exposition.  It  does 
not  reflect  the  condition  and  present  purposes  of  the  world.  If 
it  did,  it  would  emphasize  the  possibility,  aye,  the  probability, 
that  we  may  not  for  generations  have  a  civilization  equal  to  that 
of  August  1,  1914.  This  Capital  of  the  arts,  the  learning,  and  the 
achievement  of  the  world  does  not  remotely  suggest  such  reflec- 
tions. It  suggests  living  beauty,  and  international  understanding 
and  international  peace.  We,  alas!  know  that  its  suggestion  is 
little  better  than  a  mockery,  because  these  splendid  pillars,  these 
soaring  arches  stand  in  the  forum  of  the  world  not  unlike  those 
pathetic  pillars  of  the  temple  of  Castor  and  Pollux  in  the  Roman 
Forum,  eloquent  of  the  power  and  beauty  of  a  dead  civilization. 

Against  the  methods  which  resulted  in  the  existing  European 
horror  insurance  has  always  been  a  warning  and  a  protest  and  has 
always  suggested  a  remedy.  It  has  been  a  warning  and  a  protest 
because  it  has  taught  the  insufficiency  of  the  unit  of  anything — 
whether  that  unit  be  a  man  or  a  business  or  a  nation.  It  has  sug- 
gested a  remedy  not  only  because  of  the  billions  which  it  has  dis- 
tributed (and  is  distributing  now)  in  alleviating  the  tragedies 
of  life,  but  because  it  has  taught  and  practiced  the  doctrine  of 
cooperation,  in  which  lies  the  greater  portion  of  any  existing  and 
reasonable  hope  that  our  civilization  may  not  after  all  be  utterly 
overwhelmed. 

In  the  struggle  for  existence  insurance  is  a  device  by  which 
present  strength  unites  to  protect  society  against  the  weakness  that 
lurks  everywhere. 

Insurance  is  a  perpetual  warning  that  nationality  as  a  basis  for 
civilization  is  insufficient.  Civilization  has  broken  down  because 
its  units — the  nations — could  severally  no  more  carry  their  indi- 
vidual risk  than  a  man  can  carry  the  risk  of  his  own  mortality. 
If  each  great  nation  had  a  world  completely  to  itself,  the  problem 
might  be  different.  But  our  problem  is  gravely  complex.  Here 
are  eight  great  powers  and  several  times  that  number  of  lesser 
sovereignties,  each  struggling  and  developing  on  the  theor^^  that 
they  severally  are  substantially  alone  in  the  world.  They  recognize 
the  existence  of  other  powers  through  contracts  called  treaties. 
The  morality  of  those  treaties  is  historically  shown  to  be  little 
better  than  the  "honor"  which  exists  amongst  bullies  and  thieves. 
They  are  necessarily  interpreted  by  their  makers  and  not  by  an 
impartial  court,  because  there  is  no  such  court,  and  can  be  none 
under  the  existing  doctrine  of  sovereignty. 

The  nations,  therefore,  have  lived  internationally  in  an  order 
where  the  hazard  was  greater  than  the  normal  hazards  of  life 
and  business.  It  could  hardly  be  called  a  hazard  at  all;  it  was 
a  certainty.  This  world  struggle  was  inevitable,  unless  radical 
reorganization  of  international  relations  were  agreed  to,  unless 
some  plan  of  international  insurance  could  be  established.    Little, 


WORLD'S  INSURANCE  CONGRESS  79 

however,  was  done.  The  god  of  unconditioned  sovereignty  was 
everywhere  worshipped.  Nationality  unpinged  upon  nationality. 
The  world  grew  smaller.  The  international  impact  grew  heavier. 
Germans  saw  the  significance  of  the  doctrine  of  sovereignty  in  the 
time  of  the  Great  Frederick.  They  began  to  get  ready.  The  other 
European  nations  did  not  see  the  true  significance  of  the  situation 
and  prepared  only  half-hearted  for  a  struggle  upon  which  they 
never  really  expected  to  enter. 

No  nation  took  the  lead  in  a  movement  to  insure  the  perpetuity 
of  all  through  assured  peace  for  all.  Germany,  logically  follow- 
ing the  doctrine  of  sovereignty,  deliberately  prepared  to  impose 
her  civilization  on  the  entire  world.  The  other  nations  built  up 
the  elaborate  fabric  of  their  peaceful  purposes  without  adequate 
preparations  to  defend  that  structure  by  force  on  the  one  hand 
or  a  program  of  world  cooperation  to  preserve  it  on  the  other. 

Germany  aimed  to  insure  herself  by  her  might  which  spelled 
world  dominion  and  could  mean  nothing  else.  The  other  nations 
denied  any  ambition  for  world  dominion  and  at  the  same  time 
utterly  neglected  to  protect  their  integrity  through  cooperation. 
The  so-called  Allies  have  neither  lived  up  to  the  logic  of  uncon- 
ditioned sovereignty  nor  prepared  the  world  for  its  opposite 
through  international  insurance. 

The  Government  at  Washington,  whatever  else  it  is,  is  a  great 
insurance  company  whose  chief  function  is  to  guarantee  the  peace 
and  integrity  of  the  States.  It  follows  precisely  the  principles 
which  underlie  all  sound  insurance.  Why  do  California  and  New 
York  exist  as  commonwealths  to-day?  Would  they  probably  exist 
but  for  the  Federal  Union  ?  Have  they  lost  any  dignity  or  power 
or  happiness  because  they  have  duly  subscribed  to  the  great  insur- 
ance compact  of  1789  ?  Would  the  nations  fare  differently  if  a  like 
compact  were  made  under  the  Federation  of  the  World  ? 

When  some  one  remarks  that  we  must  travel  a  long  way  for- 
ward before  we  reach  such  a  federation,  it  becomes  pertinent  to 
reply  that  we  have  traveled  a  long  way  backward  within  fourteen 
months,  and  at  infinite  cost.  If  the  constructive  forces  of  the 
world,  as  they  existed  on  August  1,  1914,  could  have  been  brought 
into  cooperation,  if  the  bigotry  that  skulks  behind  what  we  call 
patriotism  could  have  been  exercised,  if  human  rights  and  not 
national  sovereignty  could  have  been  made  the  supreme  purpose 
of  civil  society,  the  distance  which  then  separated  us  from  a  con- 
dition of  international  civilization  and  world  peace,  real  peace, 
lasting  peace,  would  have  been  shorter  than  that  already  meas- 
ured in  the  existing  plunge  toward  chaos.  The  world  was  so  led 
that  it  stupidly,  stupidly  chose  to  plunge  towards  chaos. 

The  man  who  doesn't  insure  his  life  and  his  property  and  his 
business  we  rate  as  stupid.  Sovereignty  is  to  every  citizen  a  men- 
ace as  real  as  that  of  the  vicissitudes  of  life,  an  enemy  as  certain 
and  cruel  in  its  average  action  as  human  mortality.  Yet  self- 
governing  men,  men  who  otherwise  think  and  look  facts  in  the 


80        WORLD'S  INSURANCE  CONGRESS 

face,  make  little  or  no  provision  against  its  operation.  In  seeking 
for  a  word  which  dseribes  the  condition  of  mind  of  the  average 
citizenship  of  the  world  in  its  attitude  toward  sovereignty,  that 
word  "stupid"  fits  better  than  any  word  I  know. 

For  the  common  man  to  allow  his  governments  to  force  him  to 
kill  and  be  killed  for  no  sufficient  reason  is  stupid;  for  him  to 
become  obsessed  with  the  idea  that  the  peoples  of  other  nations 
want  to  wrong  him  is  stupid ;  for  him  to  believe  that  it  is  his  duty 
to  slay  his  fellows  and  destroy  their  property  is  stupid;  for  him 
to  raise  up  sons  at  infinite  pain  and  at  heavy  cost  to  have  those 
sons  fed  to  cannon  is  stupid;  for  him  not  to  see  through  its  de- 
signs or  unconscious  errors  of  politicians  and  rulers  is  stupid; 
for  him  to  have  followed  leaders  so  wicked  or  so  blind  that  they 
have  led  him  to  a  shambles  was  stupid.  It  was  stupid — because 
there  is  nothing  about  this  war  that  suggests  Thermopylae  or 
Tours  or  Lexington  or  Gettysburg,  where  resistance  was  righ- 
teously made  to  tyranny  or  error.  This  war  is  the  logical  result- 
ant of  forces  that  were  perfectly  open  in  their  operation  and 
perfectly  certain  in  their  issue.  The  statesmen  of  the  world 
could  not  or  did  not  rise  above  the  provincialism  of  nationality. 
Remorselessly  or  blindly  or  stupidly — some  will  say  deliberately — 
they  drove  the  great  machines  of  modern  civilization  into  each 
other,  head  on. 

We  have  on  our  Northern  border  all  the  elements  of  a  similar 
collision.  Four  thousand  miles  of  frontier  separate  us  from  Can- 
ada. Along  that  entire  front  there  has  been  no  fort  and  on  the 
great  inland  seas  which  lie  between  no  ship  of  war,  for  well  nigh 
a  century.  There  is  nowhere  in  the  world  a  more  splendid  people 
than  these  Canadian  neighbors.  For  us  and  them  to  drift  along 
in  a  sort  of  a  fool 's  paradise  with  no  strong  and  definite  arrange- 
ment which  will  insure  them  and  their  sons  and  us  and  our  sons 
against  the  insanity  of  war  is  stupid.  We  have  been  lucky  for  a 
hundred  years  because  nothing  has  disturbed  our  dreaming,  but 
we  are  infinitely  stupid,  not  that  we  realize  the  brutal  possibili- 
ties of  present  day  civilization,  in  continuing  conditions  fraught 
with  such  hideous  consequences.  It  would  be  as  savage  and  as 
monstrous  for  us  to  fight  with  Canada  as  it  would  be  for  Califor- 
nia to  fight  w-ith  Oregon.  There  is  no  natural  reason  why  we 
should— and  yet,  who  shall  say  what  may  happen  while  tliey  assert 
that  our  rights  as  nations  are  paramount  to  our  several  rights  as 
individuals,  as  human  beings? 

Consideration  of  our  relations  with  Canada  brings  us  squarely 
up  against  the  question  of  our  own  condition  in  our  relations  to 
international  problems. 

There  are  two  types  of  international  peace  insurance,  one  al- 
ready established,  the  other  to  be  established: 

First:  Peace  insurance  based  on  might — expressed  generally  in 
a  great  standing  army  and  a  powerful  navy. 

Second:  Peace  insurance  based  on  a  League  or  Federation,  to 


WORLD'S  INSURANCE  CONGRESS  81 

which   the   nations  shall   have   delegated  such  authority   as  will 
enable  it  to  enforce  peace  internationally. 

The  first  type  of  insurance  may  be  called  the  European  plan, 
adopted  practically  by  all  the  great  trans-Atlantic  powers,  and  at 
least  one  of  the  trans-Pacific  powers,  and  most  perfectly  exem- 
plified by  Germany.  What  sort  of  peace  that  plan  produces 
Europe  now  teaches  us.  What  the  system  ultimately  leads  to 
Shakespeare  expresses  through  Ulysses  in  "Troilus  and  Cressida," 
when  he  says: 

''Then  everything  includes  itself  in  power. 

Power  into  will,  will  into  appetite; 

And  appetite,  an  universal  wolf. 

So  doubly  seconded  with  will  and  power, 

Must  make,  perforce,  an  universal  prey, 

And,  last,  eat  up  himself. ' ' 

The  second  type  of  insurance  may  be  called  the  American  plan 
and  is  exemplified  in  the  Federation  formed  by  the  Thirteen 
Colonies  in  1789.  Wliat  sort  of  peace  insurance  the  American 
plan  produces  the  status  of  the  States  under  the  Federal  Union 
shows.  What  it  shall  lead  to  depends  largely  upon  what  we  do  in 
the  near  future. 

We  are  now  at  the  parting  of  the  ways.  We  are  living  by  the 
American  plan ;  as  a  people  we  are  acting  as  we  would  act  if  the 
Federation  of  the  World  were  already  an  accomplished  fact.  As 
a  government,  on  the  other  hand,  we  are  acting  on  the  European 
plan,  asserting  our  rights  under  so-called  international  law,  and 
threatening  to  establish  those  rights  by  force.  We  may  now  and 
then  establish  our  rights  internationally  by  what  appears  to  be 
sheer  moral  force ;  but  the  man  is  blind  who  does  not  see  that  in 
a  direct  issue,  when  nations  believe  their  existence  is  imperilled, 
the  only  law  is  still  the  law  of  might. 

Believing,  on  the  other  hand,  that  the  time  has  come  for  the 
world  to  abandon  the  European  plan,  and  believing  that  in  our 
own  Federal  Government  we  have  a  model  for  the  government 
of  the  world,  we  have  taken  no  very  serious  steps  to  establish 
an  adequate  League  or  Federation  of  the  Nations,  without  which, 
governmentally,  we  are  as  much  ahead  of  our  age  as  Roger  Wil- 
liams was  ahead  of  his  age,  and  incidentally  perhaps  we  are  in- 
viting the  same  fate.  We,  therefore,  even  more  than  the  nations 
opposing  Germany,  have  neither  lived  up  to  the  doctrine  of 
sovereignty  nor  to  the  doctrine  of  human  brotherhood. 

You  have  welcomed  us  to  an  Exposition  which  reflects  the 
civilization  of  the  twentieth  century  at  its  zenith — possibly  it  re- 
flects civilization  at  the  highest  point  it  ever  reached — if  we  con- 
sider its  relation  to  the  forces  of  nature  and  its  triumph  over 
some  of  the  mysteries  which  she  has  until  recently  so  sedulously 
and  so  successfully  kept  from  us.     But  the  tragedy  of  it!     You 


82        WORLD'S  INSURANCE  CONGRESS 

show  us  these  wonders  wrought  out  for  the  comfort  and  happiness 
of  mankind,  and  behold !  the  wonders  have  become  monsters,  be- 
cause these  master  achievements  have  been  perverted  into  imple- 
m^ents  of  wholesale  murder.  Something  was  lacking  in  the  plan. 
What  was  it  ? 

The  world  plan  which  this  Exposition  represents  lacked  the 
principle  for  which  this  Congress  stands.  The  Exposition  repre- 
sents efficiently  without  conscience,  progress  without  order,  power 
without  responsibility.  It  represents  the  work  of  men  far  ad- 
vanced into  the  unknown  who  have  since  become  confused  and 
instead  of  fighting  a  common  enemy  have  fallen  upon  each  other. 
They  advanced  so  eagerly  that  they  lost  touch,  they  lost  sympa- 
thy— they  did  not  see  the  whole  problem. 

Insurance,  on  the  other  hand,  represents  an  intelligent  appreci- 
ation of  the  whole  problem.  Its  members  do  not  become  confused 
and  fight  each  other;  they  help  each  other.  In  its  efficiency  there 
is  the  conscience  of  just  dealing,  which,  outside  the  New  England 
conscience,  is  perhaps  the  best  of  all  consciences.  In  its  progress 
there  is  the  strength  of  an  elbow  touch  so  wide  that  disorder  can- 
not break  in ;  its  power  lies  in  regulation  and  order  and  respon- 
sibility and  international  democracy. 

This  Exposition  represents  the  doctrine  of  sovereignty.  This 
Congress  represents  the  doctrine  of  democracy. 

In  our  adherence  as  a  people  to  the  doctrine  of  sovereignty, 
we  are  not  only  blind  but  inconsistent  and  very  nearly  unfaithful 
to  our  own  political  creed.  In  1776  our  fathers  signed  a  declar- 
ation of  principles  as  well  as  a  declaration  of  rights  and  of  inde- 
pendence. They  declared  their  adherence  to  the  self-evident  truth 
that  all  men — not  citizens  of  the  United  States  alone,  but  all  men 
— are  created  equal,  and  that  they  are  endowed  by  their  Creator 
with  certain  inalienable  rights,  amongst  which  are  the  pursuit  of 
life,  liberty  and  happiness.  That  all  men  are  created  equal  is 
not,  of  course,  wholly  true ;  but,  in  so  far  as  it  is  sound  and  in 
so  far  as  it  is  unsound,  it  is  equally  sound  and  unsound  every- 
where. Its  error  does  not  follow  national  lines.  In  international 
relations  we,  with  all  other  republics,  constantly  forget  that  men 
are  men  whatever  their  country,  that  the  demos  is  the  demos 
whatever  its  nationality. 

A  democracy  which  is  democratic  within  its  own  geofrraphic 
limits  only  and  treats  all  other  peoples  claiming  other  allegiance 
as  beyond  the  pale,  is  pro\'incial  and  selfish  and  has  missed  the 
real  mrnning  of  the  doctrine  which  Jefferson  penned  and  the 
fathers  signed. 

There  are  some  twenty-four  republics  in  the  world.  ^Nlost  of 
them  are  truly  democratic  internally.  All  of  them  are  arbitrary, 
autocratic  and  undemocratic  in  their  relations  with  one  another. 
Under  the  doctrine  of  unconditioned  sovereignty  democracy  dies 
at  the  frontier  of  every  republic. 

The  only  true  business  democracies  in  the  world  to-day,  deraoe- 


WORLD'S  INSURANCE  CONGRESS  83 

racies  which  do  not  change  their  principles  at  any  geographic  fron- 
tier and  have  themselves  no  frontiers,  are  the  great  insurance 
corporations  whose  membership  is  worldwide  and  so  soundly  and 
so  democratically  related  that  no  dynastic  ambition,  no  claim  of 
sovereignty,  can  at  all  change  their  beneficent  purpose  or  materially 
modify  their  humane  achievements. 

This  is  the  doctrine  that  will  be  preached  and  preached  and 
preached  in  the  several  sessions  of  this  Congress.  Never  more 
than  now  has  the  world  needed  to  heed  its  truth.  Because  its 
precepts  have  not  been  followed,  governments  are  tottering,  millions 
of  men  have  already  died,  millions  of  women  have  been  crucified, 
billions  of  dollars  have  been  squandered.  Civilization  based  on  the 
doctrine  of  sovereignty  has  failed.  It  is  time  to  adopt  a  new  pro- 
gram. The  old  program  is  damned  to  all  eternity.  That  new 
program  must  rest  in  what  Burns  had  in  his  mind  when  he  wrote : 

"A  man's  a  man  for  a'  that." 

The  thing  of  supreme  value  in  this  w^orld  is  human  life — not 
because  it  is  stamped  American  or  English  or  Russian  or  French, 
but  because  it  is  in  itself  the  sum  of  all  values,  without  which  no 
other  thing  has  any  value.  Nationality  is  the  expression  of  a  fugi- 
tive condition ;  in  sociologj^  it  is  Avhat  Burns  also  had  in  mind 
when  he  said : 

''The  rank  is  but  the  guinea  stamp." 

Insurance  may  be  primarily  a  device  for  the  protection  of  life, 
property  and  business;  but  it  deals  with  and  is  faithful  to  the 
principles  of  race  solidarity,  and  thereby  has  become  a  practical 
and  powerful  leader  amongst  the  forces  which  seek  the  ultimate 
realization  of  the  prayer  and  prophecy  which  closes  Burns'  im- 
mortal declaration  of  the  rights  of  humanity: 

"Then  let  us  pray  that  come  it  may, 
And  come  it  will  for  a'  that. 
That  man  to  man  the  world  o'er, 
Shall  brothers  be  for  a '  that. ' ' 


WORLD'S  INSURANCE  CONGRESS  MOVEMENT 
Why    the   Panmruh-Paciflc    International   Expositimi   Has    Given 
Prominent  Becogniiion  to  Insurance,  and  What  It  Hopes  the 
Congress  Will  Accomplish. 

By  Charles  C.  Moore 
President  of  the  Panama-Pacific  International  Exposition 

Mr.  Chairman,  Ladies  and  Gentlemen:  I  almost  wish  my  turn, 
was  to  come  later,  for  I  have  scarcely  emerged  from  the  spell 
of    Mr.    Kingley's    wonderfully    eloquent    words,    and  the    deep 


84        WORLD'S  INSURANCE  CONGRESS 

thoughts  that  he  has  inspired.  I  feel  that  every  man  connected 
with  this  Congress,  and  especially  with  insurance,  should  have  a 
sense  of  gratification  that  a  plan  and  idea  so  complete  and  com- 
prehensive, showing  possibilities  of  world  insurance,  should  be  pre- 
sented by  one  of  your  own.  It  is  an  inspiring  thing  to  me,  as  it 
must  be  to  you  all. 

As  the  Chairman  suggested  in  his  opening  remarks,  this  Con- 
gress was  convened  to  enable  insurance  men  to  learn  things  that 
they  didn't  know.  Frankly,  I  have  never  had  it  put  that  way  be- 
fore. I  supposed  when  the  insurance  men  presented  to  me,  repre- 
senting the  Exposition,  the  possibilities  of  this  Congress,  it  was 
to  educate  the  public,  but  the  conviction  has  been  growing  for 
some  time  in  me  that  in  the  insurance  ranks  there  was  an  ignor- 
ance (don't  be  offended,  Gentlemen)  dense  and  profound,  of  what 
should  be  the  Spiritual  lights  that  call  you.  I  have  felt  for  days, 
weeks  past,  that  insurance  men  didn't  grasp  as  I  felt  they  should 
that  side  of  their  business — profession — that  is  a  direct  appeal 
to  all  that  love  their  fellow-men.  I  have  felt  that  you  have  wasted 
some  of  your  pearls — pearls  that  might  have  meant  much  to  your- 
selves and  to  humanity,  and  therefore  it  is  inspiring  to  me  for 
such  words  to  come  from  Mr.  Kingley's  lips:  for,  good  friends, 
in  the  remarks  that  I  will  now  make  it  may  be  that  I  have  idealized 
insurance. 

I  am  a  recent  convert  to  the  world-purpose ;  the  national  scope 
of  its  activities.  I  have  not  known  the  grosser  side:  I  have  not 
felt  the  irritation  and  the  annoyance,  the  sting  of  competition. 
I  have  been  basking  for  months  in  a  glow  of  possibility — an  appre- 
ciation of  what  insurance  can  do — will  do — when  the  world  under- 
stands ;  and  therefore  please  interpret  my  remarks  with  the  under- 
standing that  I  am  only  a  plain  business  man  that  recently  has 
seen  what  he  thinks  is  the  light,  and  desires  to  share  that  light 
with  all  his  fellow-men. 

I  have  been  asked  to  state,  first,  why  the  Exposition  has  given 
such  prominent  recognition  to  Insurance ;  and,  second,  what  it 
hopes  the  Congress  will  accomplish.  Rather  elementar^^  questions 
it  must  seem  to  you  gentlemen  of  the  profession,  for  you  know 
that  Insurance  does  deserve  such  recognition;  but  with  my  asso- 
ciates I  have  but  recently  learned  that  such  recognition  was  de- 
served, and  am  convinced  that  the  unthinking  public  have  but 
little  understanding  of  what  Insurance  stands  for,  its  might,  its 
greatness,  its  goodness,  and  its  vast  potential  influence  on  human 
welfare.  When,  therefore,  we  became  converted,  with  the  pro- 
verbial zeal  of  converts,  it  was  our  desire  to  enable  the  greatest 
possible  number  of  our  fellow-men  to  see  as  we  had  seen,  to  realize 
and  to  understand.  That  is  our  answer  to  the  first  question,  and 
the  answer  to  the  second  goes  with  the  first — our  earnest  desire 
that  the  light  may  shine  and  that  the  Exposition  may  aid  in  the 
propaganda  of  education  to  the  advantage  of  Insurance,  of  the 
individual,  and  of  the  Nation. 


WORLD'S  INSURANCE  CONGRESS        85 

This  is  the  first  World's  Insurance  Congress.  There  is  novelty 
in  the  name,  hope  in  the  thought,  progress  in  the  sentiment.  The 
Exposition  is  a  debtor  to  the  men  and  the  interests  here  repre- 
sented who  have  made  it  possible  to  write  such  a  brilliant  page 
in  the  history  of  the  Exposition,  and  yet  it  is  exceedingly  appro- 
priate that  the  World's  Insurance  Congress  should  have  been  held 
here  and  now.  The  Congress  is  in  keeping  with  the  tenets  and 
purposes  of  the  Exposition,  to  educate,  educate,  everlastingly  edu- 
cate and  elevate  the  level  of  popular  understanding  and  appreci- 
ation of  Art,  Architecture,  Music,  Color,  Lighting,  and  of  the 
products  of  hand  and  brain  of  all  countries;  to  show  the  progress 
and  advancement  of  the  race  and  the  finer  and  nobler  things  of 
life. 

In  truth,  an  Universal  Exposition  should  be,  and  is,  a  university, 
and  in  the  popular  courses  in  such  institutions  what  could  be  more 
appropriate  and  beneficial  than  to  have  included  opportunity  to 
present  to  the  public  mind  in  a  graphic,  convincing  way,  this 
mighty  force,  this  great  instrument  for  human  welfare,  this  agency 
for  good— great  in  past  performances,  greater  in  future  promise — 
Insurance  in  its  variety. 

Insurance  is  an  old  business,  but  it  is  more  than  a  business. 
It  is  a  benefaction,  and  logically  its  followers  are  benefactors. 
He  is  not  always  recognized  and  accepted  as  such,  but  in  his 
conscience  every  insurance  man  knows  that  security  and  personal 
blessings  go  with  his  proper  business  acts — to  guarantee  the  strong, 
safeguard  the  weak,  protect  the  dependent,  improve  the  public 
health,  promote  longevity,  secure  better  laws,  encourage  the  thrifty, 
stimulate  the  qualities  of  attention  to  family  needs,  present  and 
future,  promote  economy,  proper  saving,  and  a  sense  of  respon- 
sibility of  one's  self  and  to  others— verily— the  Ten  Command- 
ments of  social  economy. 

Insurance  is  the  religion  of  social  service,  and  its  followers  are 
members  of  a  gi'eat  religious  procession,  varying  in  function  and 
in  importance  from  the  agent  in  the  field,  the  acolyte,  through 
the  various  orders  to  the  eminent  Cardinals,  the  heads  of  the 
great  corporations,  but  all  contributing  in  some  way  to  increase 
the  sum  total  of  human  progress,  dedicated  to  the  protection  of 
health,  life  and  property. 

A  glance  at  the  program  of  the  Congi-ess  offers  further  evidence, 
if  any  is  needed,  of  the  extent  and  the  variety  of  insurance  ac- 
tivity. I  am  proud  to-day  to  greet  you  here  as  component  parts 
of  a  great  profession.  You  are  all  in  the  same  Church,  if  not  in 
the  same  pew.  It  would  seem  to  me,  therefore,  unnecessary  for 
me  to  make  particular  allusion  to  the  various  branches  of  insur- 
ance, which  will  be  so  ably  presented  by  their  exponents;  but  I 
do  want  to  offer  a  little  testimony  of  my  personal  gratification  that 
I  have  been  permitted  to  gain  a  knowledge  and  partial  under- 
standing of  what  Insurance  in  its  broadest  sense  means.     If  the 


86        WORLD'S  INSURANCE  CONGRESS 

Exposition  has  brought  me  nothing  more,  I  shall  feel  that  it  is 
compensation  for  efforts  of  mine. 

What  I  have  said  here  comes  from  one  who  is  not  an  insurance 
man  at  all,  except  for  a  little  stock  in  a  local  companj'  and  a 
policyholder  in  all  forms  of  insurance,  and  it  is  possible  some 
cannot  follow  my  enthusiastic  endorsement  of  this  Insurance  Con- 
gress and  its  effect,  but  the  words  come  from  my  heart,  and  cer- 
tainly from  now  on  I  desire  to  be  enrolled  as  a  friend  of  Insurance, 
aiding  in  giving  it  protection  from  hostile  and  unfair  legislation, 
and  assisting  the  earnest,  good  men  in  the  properly  conducted 
companies  in  establishing  themselves  in  the  position  in  the  world's 
confidence  and  affection  where  they  properly  belong. 

In  the  trend  of  modern  days  toward  better  methods  and  better 
men,  you  gentlemen  of  the  insurance  world  are,  I  feel,  to  be  con- 
gratulated that  you  are  in  a  business  embodying  high  ideals  with 
material  substance.  Fortunate  are  you  that  in  doing  good  for 
yourselves  you  can  accomplish  good  for  others  and  aid  in  elevat- 
ing the  standard  of  health  and  life  and  protection  of  property. 
Truly,  yours  may  be  called,  I  feel,  a  blessed  business. 

Before  concluding  my  remarks,  a  word  of  appreciation  from  the 
Exposition  should  go  to  those  splendid  men,  by  the  score,  more 
properly  by  the  hundred,  who  have  contributed  so  much  to  make 
this  World's  Insurance  Congress  possible.  The  local  committee 
has  been  indefatigable  in  its  efforts,  and  I  will  mention  no  names 
in  this  connection,  with  one  exception.  I  w^ould  do  injustice 
to  the  Exposition  and  to  the  insurance  world  if  I  failed  to  here 
pay  tribute  to  the  breadth  of  vision,  unselfish  devotion,  loyalty 
and  enthusiasm  to  the  cause,  of  Insurance  Commissioner  W.  L. 
Hathaway.  He  conceived  the  idea,  and  convinced  us  all  of  the 
great  possibilities  of  this  work;  and  with  mind,  hand  and  puree 
has  supported,  at  times  almost  carried  the  splendid  enterprise. 
His  satisfaction  of  conscience  must  be  his  greatest  reward,  but  I 
know  that  you  will  agree  with  me  that  these  few  words  inade- 
quately express  the  sentiments  we  all  hold  toward  his  splendid 
direction  of  this  gi'eat  work. 


SERVICE  PERFOR.AIED  BY  INSURANCE 

By  Hon.  J.  N.  Gillett 

Ex-Governor  of  California,  Who  Held  Office  during  the 
Reconstruction  Period  of  San  Francisco 

Mr.  Chairman,  Ladies  and  Gentlemen :  It  is  very  fitting  that  the 
first  Insurance  Congress  should  be  held  here  in  San  Francisco. 
This  marks  the  place  of  insurance's  greatest  achievement,  where 
it  was  put  to  the  acid  test,  where  it  accomplished  its  greatest 
victory,  and  where  it  satisfied  the  minds  of  the  world  of  the  great 
power  of  insurance  to  rebuild  where  disaster  destroyed. 


WORLD'S  INSURANCE  CONGRESS  87 

So  it  is  very  fitting,  I  say,  that  this  first  Congress  should  be 
held  here  in  San  Erginciseo,  and  I  am  glad  that  all  lines  of  in- 
surance are  represented,  because  the  entire  insurance  field  was 
called  upon  to  respond  at  the  time  when  this  city  was  stricken  by 
fire  and  earthquake. 

It  is  a  difficult  question  to  go  into,  at  great  length,  all  of  the 
services  that  have  been  performed  by  insurance.  It  was  stated 
early  at  the  commencement  of  this  Congress  that  a  time  once 
existed  when  people  looked  with  suspicion  upon  the  insurance 
business  and  classed  it  as  a  sort  of  a  gamble;  but  insurance  was 
made  necessary  through  the  necessity  of  man  in  his  business  and 
in  his  life. 

Insurance  is  one  of  the  greatest  factors  to-day  in  the  business 
and  commercial  life  of  the  nation.  The  necessities  of  commerce 
gave  it  is  birth,  and  it  has  expanded  and  developed  with  commerce, 
always  meeting  its  wants  and  protecting  its  ever  widening  fields, 
encouraging  it  to  go  forward,  helping  it  when  in  distress  and  insur- 
ing its  success.  It  has  from  time  to  time,  with  wonderful  facility, 
adapted  itself  to  the  new  interests  of  an  advancing  civilization, 
fostering  enterprises,  repairing  losses,  assisting  those  whom  mis- 
fortune has  overtaken  and  bringing  to  the  fatherless  a  support 
to  take  the  place  of  that  which  death  deprived  them  of.  The 
services  of  Insurance  cannot  be  measured ;  without  its  fostering 
hand  it  would  be  impossible  to  conduct  the  business  and  life 
of  the  world  as  it  is  conducted  to-day.  The  ships  that  sail  on 
our  seas  carrying  the  commerce  of  the  nations  of  the  earth  face 
tides  and  storms,  rocks  and  shoals,  and  all  other  perils  of  the  deep, 
safe  and  secure  with  a  life  line  thrown  to  the  shore  which  protects 
every  loss  no  matter  what  disaster  may  overtake  it.  Homes  may 
be  destroyed,  great  business  blocks  fall  in  ruins,  and  factories 
disappear,  but  there  is  standing  by  a  silent  force  that  stretches 
forth  its  hand  and  they  arise  again.  Sickness  and  disease  may 
overtake  us,  but  beside  the  doctor  and  the  nurse  stands  Insurance 
ministering  to  our  wants  and  taking  care  of  our  necessities.  Death 
may  enter  the  home  and  claim  the  husband  and  father,  but  Insur- 
ance follows  after,  preserves  the  home,  keeps  the  little  family 
together  and  educates  the  children. 

So  in  nearly  every  walk  of  life  Insurance  plays  its  part  and 
comes  to  the  relief  of  man  in  times  of  his  adversity.  "A  friend 
in  need  is  a  friend  indeed,"  and  such  a  friend  is  Insurance. 

Every  day  it  is  busy  through  the  land  repairing  the  losses  caused 
by  fire,  storms,  sickness,  accident  and  death.  It  trails  disaster 
everywhere  and  triumphs  over  it.  The  work  is  done  quietly  and 
almost  unnoticed.  It  is  estimated  that  this  year  the  amount  col- 
lected for  voluntary  insurance  will  be  about  $1,501,000,000,  an 
enormous  sum  of  money,  over  six  hundred  tbousand  dollars  more 
than  Congress  appropriates  to  meet  the  demands  of  this  nat'!nn 
for  one  year,  and  all  of  this  vast  sum,  except  the  mere  expense  of 
collecting  and  distributing  it,  will  go  to  pay  the  losses  suffered 


88        WORLD'S  INSURANCE  CONGRESS 

during  the  year  and  to  secure  those  who  may  lose  in  succeeding 
years.  This  large  sum  of  money  is  distributed  all  over  the  nation 
and  no  notice  is  talicn  of  it.  It  is  only  when  great  calamities 
overtake  a  community,  such  as  the  Chicago,  Baltimore  and  San 
Francisco  fires,  that  public  notice  is  taken  of  the  great  benefits  of 
Insurance  and  of  the  splendid  service  it  is  rendering  to  mankind. 

The  San  Francisco  fire  offers  the  best  illustration,  it  being  the 
most  recent  and  the  greatest  in  the  amount  of  loss  incurred  and 
the  extent  of  territory  involved.  On  the  evening  of  April  17,  1906, 
the  citizens  of  San  Francisco  rested  from  a  busy  day.  There  was 
the  San  Francisco  life  in  the  theaters  and  other  places  of  amuse- 
ment, in  the  restaurants  and  on  the  streets.  There  was  that  feel- 
ing of  optimism  and  good  cheer  which  was  felt  everywhere  and  led 
to  goodfellowship  and  contentment.  Its  citizens  were  prosperous, 
their  lives  were  happy  and  of  hardships  they  had  but  few.  The 
wealth  from  the  hidden  treasures  of  the  Sierras  and  from  the 
golden  grain  and  fruits  of  the  valleys  of  California  had  been  for 
years  pouring  into  the  City  and  had  made  of  it  a  splendid  metrop- 
olis. During  all  these  years  there  had  also  been  flowing  from  the 
City  a  fund  collected  for  its  protection,  a  fund  solicited  by  In- 
surance. 

On  the  morning  of  the  18th  of  April  the  citizens  were  startled 
by  a  severe  earthquake.  Shortly  after  this  fires  broke  out  in 
different  parts  of  the  city — fires  that  spread  rapidly.  The  water 
mains  had  been  broken  by  the  earthquake  and  the  fire  fighting 
force  was  helpless.  The  whole  city  was  fully  alive  to  the  great 
danger  impending.  Block  after  block  of  fine  business  buildings 
were  caught  up  in  the  holocaust  and  added  fuel  to  its  fury.  The 
flames  and  heat  and  smoke  spread  everywhere,  driving  before  them 
the  inhabitants.  Nothing  could  stop  their  mad  advance,  nothing 
could  stay  the  great  devastation  of  property,  the  accumulation 
of  years,  that  was  going  on.  For  three  days  this  continued  and 
the  fire  god  then  passed  away  and  left  behind  him  a  desolate  city, 
a  ruined  city,  a  silent  and  awestruck  people.  Their  business  all 
gone,  their  banks  and  factories  in  ruins,  their  homes  destroyed, 
they  stood  in  groups  and  looked  upon  this  vast  ruin  in  silence. 
They  gazed  upon  a  space,  where  once  stood  a  proud  and  beautiful 
city  teeming  with  life  and  business,  but  now  a  waste  of  fallen 
stone  and  brick,  and  deformed  and  twisted  iron  and  steel.  The 
savings  and  accumulations  of  two  generations  lay  buried  and  in 
ashes  before  them.  But  still  in  its  fallen  helplessness  the  old  San 
Francisco  appealed  to  them,  and  from  its  ruins  came  a  cry  for 
resurrection.  From  this  great  ruin,  from  this  waste  and  desola- 
tion, where  lay  buried  the  treasures  of  a  great  city,  they  lifted 
their  eyes  and  they  saw  a  golden  stream  flowing  toward  them, 
coming  from  the  east,  bringing  with  it  a  new  hope,  a  new  San 
Francisco.  It  was  the  return  of  the  Insurance  tide  that  had  for 
years  been  flowing  eastward.  It  was  a  force  that  fire  nor  earth- 
quake could  destroy  or  divert.     It  meant  the  rebuilding  of  what 


WORLD'S  INSURANCE  CONGRE?^S  89 

the  elements  so  ruthlessly  had  destroyed;  it  meant  the  rehabita- 
tion  of  a  great  city  dethroned.  It  gave  courage  and  strength  to 
the  citizens  of  San  Francisco  and  lifted  from  them  the  gloom 
that  three  terrible  days  had  settled  upon  them.  From  a  despond- 
ent people  they  became  a  hopeful  community.  With  reverence 
they  laid  their  hands  upon  the  tumbled  piles  of  brick  and  stone 
that  had  once  been  their  homes  and  their  temples,  and  commenced 
to  clear  the  space  upon  which  was  to  be  constructed  a  better  city, 
a  modern  city  and  a  monument  to  the  courage  and  optimism 
of  western  life — a  living  and  everlasting  proof  of  the  service 
Insurance  can  and  does  render. 

Over  four  hundred  millions  of  dollars  was  contributed  by  In- 
surance toward  doing  this  great  work.  Of  this  amount  fire  insur- 
ance contributed  about  $225,000,000  in  losses  paid ;  life  insurance 
contributed  more  than  $100,000,000  in  cash  loaned  to  policyholders, 
and  death  losses  paid  besides  lending  $85,000,000  on  real  estate 
values ;  the  remainder  came  from  casualty  and  miscellaneous  insur- 
ance sources. 

Thus  was  San  Francisco  restored;  thus  were  her  citizens  en- 
abled to  restock  their  stores  and  renew  their  business;  thus  was 
a  great  calamity  turned  into  a  blessing  and  without  the  service 
rendered  by  Insurance  this  could  not  have  been  done  within  a 
generation.  Without  Insurance  many  of  its  citizens  who  now  are 
prosperous  would  have  been  ruined— their  accumulations  of  a  life- 
time gone  and  no  prospect  left  or  years  remaining  to  gain  an- 
other competency. 

San  Francisco  has  been  rehabilitated.  Its  restoration  was  mar- 
velous. The  spirit  of  its  people  was  tried  in  fire  and  was  un- 
broken. Besides  the  task  of  rebuilding  their  city,  its  citizens 
undertook,  at  the  same  time,  the  building  of  a  great  Exposition 
to  commemorate  the  completion  of  the  Panama  Canal.  This  great 
Exposition,  which  has  exceeded  all  preceding  ones,  is  drawing  to 
a  close,  and  it  is  fitting  that  at  this  time  representatives  of  the 
Insurance  Companies  of  the  world  should  assemble  here  and  hold 
an  Insurance  Congress.  Without  the  aid  of  Insurance  in  rebuild- 
ing San  Francisco  the  Exposition  would  never  have  been  held 
here;  and  besides  there  is  no  field  in  all  the  world  where  Insur- 
ance can  truthfully  say  to  the  elements,  "You  may  destroy  but 
you  cannot  annihilate." 

What  Insurance  did  for  the  people  of  San  Francisco,  it  is  doing 
every  day  for  others.  Whole  cities  are  not  being  built,  but  de- 
stroyed homes,  ruined  factories  and  losses  of  all  kinds  of  prop- 
erty, happening  daily  throughout  the  world,  are  being  restored. 
Besides  this,  millions  are  being  paid  where  the  life  of  the  bread 
winner  has  been  claimed  and  where  accidents  have  incapacitated 
men  and  women  from  work.  Insurance  is  daily  becoming  a  greater 
factor  in  the  progress  of  the  world's  work.  It  makes  safe  the 
pathless  ocean,  where  commerce  battles  with  the  perils  of  the 
sea;  it  protects  the  life  earnings  of  man  and  secures  him  in  his 


90        WORLD'S  INSURANCE  CONGRESS 

old  age ;  it  holds  together  the  little  family  after  death  has  entered 
it  and  claimed  the  father ;  it  protects  the  daily  wage  of  the  laborer ; 
it  safely  guards  the  business  of  man,  and  stands  guard  over  his 
home.  These  are  the  services  Insurance  renders  and  there  are 
none  other  greater. 

This  service  should  be  protected  and  encouraged  by  wise  and 
just  laws — laws  that  are  uniform  and  apply  to  the  whole  country, 
because  insurance  is  not  local ;  for  it  reaches  into  every  section 
of  the  nation  where  man  is  or  where  his  interests  lie.  If  there 
is  to  be  insurance  supervision,  it  should  be  by  one  commission 
and  not  by  many,  and  this  commission  should  be  acting  under 
the  authority  of  the  Federal  Government.  Laws  to  encourage  as 
well  as  to  regulate  insurance  should  be  enacted,  and  these  laws 
should  be  found  in  the  federal  statutes  and  not  in  the  session  laws 
of  the  several  states  of  the  Union.  The  Government  should  foster 
Insurance  and  by  wise  legislation  encourage  it,  for  it  is  the  one 
great  agency  that  meets  the  wants  and  necessities  of  man  in  his 
every  w^alk  of  life,  and  serves  him  faithfully  and  well  at  a  time 
when  help  is  needed.  It  gathers  from  everywhere  a  fund  that 
can  be  immediately  paid  out  wherever  losses  occur,  and  thus 
promptly  gives  assistance.  The  service  of  Insurance  is  broad 
as  the  losses  and  adversities  of  man  and  it  meets  all  that  is 
expected  of  it. 

So  we  want  to  protect  this  great  force  in  the  life  of  our  country. 
We  want  to  protect  by  just  laws  the  business  of  the  companies. 
I  know  of  no  more  interesting  study  in  all  of  our  jurisprudence 
than  the  studj^  of  insurance  law,  and  I  know  of  no  institution  in 
the  country  to-day  more  in  need  of  protection  than  that  of  In- 
surance. It  fights  disaster,  and  conquers  it.  It  makes  safe  the 
business  in  which  we  are  engaged,  the  person,  the  home  in  which 
we  live.  It  protects  the  commerce  of  the  world.  It  is  a  great  social 
force  making  for  better  conditions. 

So  we  want  safe  Insurance — Insurance  that  protects.  Had  we 
dependent  upon  insurance  of  a  state  character,  or  mutual  insur- 
ance of  ourselves,  in  our  great  crisis,  we  would  have  failed.  It 
took  not  only  the  savings  of  our  City  and  State,  but  of  all  the 
states — yes,  and  of  many  countries — to  rebuild  San  Francisco. 

Now  I  say  that  Insurance  has  been  growing  very  rapidly  and 
is  attracting  the  attention,  more  and  more,  of  the  people  of  this 
country.  Large  reserves  are  being  piled  up  in  all  lines  of  Insur- 
ance— not  only  money  to  meet  present  losses,  but  money  that  is 
being  loaned  out,  money  that  is  intended  for  future  losses — and 
the  people  of  the  country  to-day  are  heeding  more  than  ever  the 
great  importance  of  Insurance  to  the  life  of  our  nation.  Insur- 
ance is  getting  to  be  what  we  would  call  a  quasi-public  institution. 
It  is  holding  a  fund  for  the  benefit  of  the  people,  and  the  people 
are  gradually  appreciating  it  and  gradually  taking  hold  of  it. 


WORLD'S  INSURANCE  CONGRESS  91 


OPENING  ADDRESS  OF  THE  SPECIAL  CHAIRMAN 

Lawrence  Y.  Sherman 
United  States  Senator 

This  is  a  fit  time  and  place  for  a  World's  Insurance  Congress. 
The  Panama  Canal  is  this  Republic's  contribution  to  the  epoch- 
making  events  of  the  world.  The  canal  is  essentially  constructive. 
The  commerce  that  passes  it  in  future  years  is  not  more  cosmo- 
politan nor  widely  distributed  in  its  benefits  than  the  preservative, 
constructive  influence  of  insurance  against  the  certainty  of  death, 
the  hazards  of  the  elements  and  the  vicissitudes  of  business. 

We  have  destroyed  our  forests,  are  exhausting  our  soils  and 
wasting  every  year  enough  to  support  one  of  the  smaller  nations 
of  the  Old  World.  We  are  just  beginning  to  lisp  the  alphabet  of 
saving. 

Economic  laws  are,  however,  inexorable  and  irrepealable.  They 
are  universal  in  operation  and  no  respecter  of  nations.  Great 
natural  resources  may  delay  results  but  none  may  finally  escape 
them.  Thrift  is  the  antidote  for  waste  and  want.  How  difficult 
at  first  to  gain  listeners  for  conservation,  for  soil  fertility.  How 
unwelcome  yet  to  urge  economy  in  our  mines,  our  forests,  our 
fields,  and  the  uses  of  the  great  staples  of  life.  How  unwillingly 
the  individual  hears  he  must  in  some  things  practice  self-denial. 
The  economic  youth  of  our  nation  is  passing.  It  once  seemed  in- 
exhaustible. Like  you  of  older  nations  we  face  the  problems  of 
self-support  for  our  own  people. 

How  easy  to  destroy,  how  hard  to  restore,  and  how  few  the 
builders !  I  repeat,  I  would  rather  be  the  builder  of  a  hut  than  the 
destroyer  of  a  palace. 

Constructive  ability  is  the  constant  need  of  every  generation, 
constructive  in  new  methods  of  applying  Nature's  forces  to  hu- 
man wants,  constructive  in  legislation  that  shall  not  merely  breathe 
the  spirit  of  demolition,  constructive  in  social  justice  that  shall 
not  hinder,  discourage  or  unduly  burden  the  prudent  and  indus- 
trious, that  may  destroy  only  where  sober  judgment  demonstrates 
new  instrumentalities — constructive  ability  shall  take  the  place 
better  to  serve  to  reach  desired  ends. 

We  meet  under  conditions  that  have  changed  the  world.  Even 
neutral  nations  no  longer  feel  secure.  No  treaty  seems  sacred. 
Barbaric  force  is  still  the  substitute  for  justice  in  half  the  world. 
The  destruction  of  life  and  material  resources  is  unparalleled. 
The  war  debt  will  exceed  the  limits  of  imagination.  The  taxable 
wealth  and  productive  energy  of  the  future  are  pawned  to  the 
present  and  dedicated  to  sacking  cities  and  indiscriminate  butchery. 

Who  remains  to  define  modern  civilization  after  a  year  of 
modern  war!     All  human  affairs  end.     The  benediction  of  peace 


92        WORLD'S  INSURANCE  CONGRESS 

will  sometime  hallow  the  battlefields  of  Europe.  The  era  of  the 
builder  will  then  dawn,  but  on  him  will  be  the  unceasing  toil 
of  the  taxgatherer.  As  the  war  has  changed  the  world,  so  has 
it  changed  economic  conditions  and  old  methods  of  living.  The 
extravagance  and  prodigality  of  the  past  are  drawing  to  a  close. 
The  spendthrift  and  the  heedless,  the  idler  and  the  incompetent 
will  have  less  chance  than  before.  The  world  will  be  forced  to 
a  higher  measure  of  economy  and  productiveness. 

In  the  reconstruction  of  the  economic  and  the  social  justice 
fabric  following  the  worldwide  change  in  conditions,  life  insur- 
ance is  destined  to  assume  an  increased  and  powerful  influence. 
It  is,  with  fire  insurance,  essentially  constructive  in  its  nature. 
Both  are  preservative  and  creative.  From  death  and  ashes  rise 
the  energy  and  protection  for  the  survivors. 

Insurance  assembles  scattered  resources.  It  mobilizes  a  small 
part  of  to-day's  earnings  against  misfortune.  It  transmutes  pos- 
sible charit}^  into  certain  self-support.  It  is  the  matured  contract 
of  prudence  and  scientific  knowledge  on  the  one  hand,  and,  on  the 
other,  is  based  on  sound  financial  principles  backed  by  the  suc- 
cessful public  and  private  business  undertakings  of  the  civilized 
world.  It  substitutes  a  certain  contract  for  the  hazards  of  busi- 
ness, the  uncertainty  of  health  and  earning  power  and  the  cer- 
tainty of  ultimate  disability  and  death. 

In  national  problems  of  conservation,  of  constructive  energj'', 
of  econom}^  and  thrift,  insurance  in  its  various  forms  stands  at 
the  threshold  of  its  greatest  usefulness. 

It  remains  an  inscrutable  mystery  why  life  insurance  companies 
are  among  the  first  objects  of  taxation  when  the  government  or 
the  state  require  additional  revenues. 

It  is  one  of  the  greatest  instruments  to  promote  self-support 
and  protect  the  family  known  to  civilized  society.  The  legislator 
who  sees  in  it  only  an  enterprise  to  be  burdened  whenever  taxes 
are  to  be  raised  has  not  analyzed  well  the  relation  between  na- 
tional strength  and  private  individual  support,  the  solvency  of 
the  family  or  its  responsible  head. 

It  is  difficult  to  realize  that  public  officers  propose  to  impose 
additional  tax  burdens  on  life  insurance.  It  is  now  paying  its 
uniform  property  tax.  It  is  to  be  singled  out,  however,  for  special 
taxes.  It  is  to  be  treated  as  if  it  were  an  occupation  which  threat- 
ened the  public  welfare  and  to  be  regulated  and  licensed  under 
the  police  power  accordingly. 

It  ought  to  be  made  clear  that  every  special  tax  is  at  last  a 
charge  on  the  policyholder.  The  higher  the  premium,  the  less  the 
volume  of  insurance  carried  in  the  aggregate.  This  in  turn  re- 
duces the  protection  to  the  family  and  increases  the  burden  finally 
to  rest  on  public  or  private  charity.  Let  it  be  understood  this  is 
the  cause  of  the  policyholder,  not  mere  of  the  companies.  ^Fake 
the  public  officer  responsible  to  the  hosts  of  policyholders,  the 
protection  of  M'hose  families  he  has  impaired.     Such  taxation  is 


WORLD'S  INSURANCE  CONGRESS  93 

a  perversion  of  the  powers  of  government  and  merits  a  rebuke 
by  the  withdrawal  of  public  confidence  from  those  who  sanction 
it. 

Fire  has  taught  its  destructive  lesson  in  the  credit  power  of 
the  borrowing  property  owner.  No  prudent  banker  or  investor 
extends  credit  to  the  owner  of  merchandise  unless  the  fire  risk 
is  adequately  covered  by  insurance.  Real  estate  titles  are  insured, 
banks  carry  burglary  insurance,  accident  insurance  covers  per- 
sonal disability.  Cargoes  and  vessels  are  insured  against  ocean 
perils.  The  destruction  of  property  by  the  elements  on  land  and 
sea  is  safeguarded  by  insurance  contracts.  This  removal  of  prop- 
erty from  the  hazards  attendant  on  the  various  stages  of  business 
is  a  material  basis  on  which  credit  is  given.  A  continuous  credit 
is  the  result  of  stable  security  by  which  the  business  currents  of 
the  country  are  directed. 

Whatever  modern  business  organization  has  done,  whatever 
great  aggregations  of  money  and  methods  have  seemingly  been 
built  for  the  years  to  come,  human  character  and  ability  are  as 
needful  now  as  in  the  days  long  gone.  There  are  only  compara- 
tively few  enterprises  in  which  the  death  of  the  master  mind 
does  not  materially  affect  their  credit.  The  average  business  un- 
dertaking is  vitally  so  affected.  Many  are  brought  abruptly  to 
a  close  by  death.  It  dissolves  all  partnerships  and  ends  all  in- 
dividual occupations. 

The  slowness  of  the  evolution  of  fixed  business  methods  is  illus- 
trated by  the  established  practice  of  insuring  property  to  cover 
credit  lines  and  the  lack  of  as  uniformly  insuring  the  life  that 
makes  possible  the  only  successful  management  of  the  business  on 
the  strength  of  which  money  is  loaned.  As  a  mere  business  ven- 
ture, life  insurance  on  the  person  conducting  a  business  is  in  a 
larger  sense  more  indispensable  than  fire,  marine  or  burglary  in- 
surance on  the  insensate  money  or  merchandise  used  by  the  living 
owner.  It  is  sound  business  prudence  to  cover  credits  by  an  equal 
line  of  life  insurance.  It  often  becomes  the  only  way  by  which  a 
partner  can  equalize  his  liabilities  against  his  more  solvent  asso- 
ciates. 

Here  lies  one  of  the  most  constimctive  elements  in  modern  society. 
It  is  business  prudence  joined  with  private  welfare.  It  commends 
itself  to  the  thoughtful  of  all  nations.  It  is  worldwide  in  its  use- 
fulness and  possibilities.  It  draws  mankind  into  more  harmo- 
nious relations  with  each  other  and  hastens  the  day  of  peace  and 
justice. 

Insurance  cannot  now  be  made  interstate  business  and  subject 
to  uniform  regulation  by  an  act  of  Congress.  Every  life  insur- 
ance company  is  now  subject  to  the  regulation  of  the  forty-eight 
states.  Each  state  is  at  liberty  to  treat  every  company  not  incor- 
porated under  its  local  laws  as  a  foreign  corporation.  Nothing 
short  of  an  amendment  to  the  Federal  Constitution  will  vest  in 
Congress  power  to  regulate  insurance.     Many  millions  of  policy- 


94  WORLD'S  INSURANCE  CONGRESS 

holders  are  your  constituents.  ]\Iost  of  them  are  voters.  Those 
directly  and  indirectly  concerned  are  powerful  in  numbers  and 
influence.  Why  should  not  such  voters  unite  in  proper  self- 
defense  ? 

The  fraternal  companies  are  rightfully  exempt  from  most  of 
the  foregoing  burdens.  No  legislature  or  politician  would  ven- 
ture to  propose  additional  charges  to  them.  The  old  line  com- 
panies enjoy  no  such  immunity.  Even  those  doing  a  purely  mu- 
tual business  are  not  exempt.  So  far  as  it  affects  the  policyholders 
both  stand  upon  the  same  footing,  viz:  an  increase  of  taxes  is  at 
last  charged  on  the  premium  and  paid  by  the  policyholder.  Some 
well  meaning  but  misguided  officials  have  regarded  them  as  fit 
enterprises  for  discrimination  and  unjust  taxation.  There  is  one 
certain  method  to  meet  it.  It  is  the  union  of  voters  who  pay 
premiums  to  your  companies.  Without  them  your  companies  could 
not  exist.  Without  the  companies  those  voting  policyholders 
could  not  procure  life  insurance.  It  is  the  union  of  members 
with  their  multiplied  paying  powers  wnth  the  business  ability 
and  detailed  knowledge  of  life  insurance  possessed  by  others  that 
creates  the  business. 

Mutual  defense  against  future  unfriendly  legislation  is  as  mer- 
its ious  as  the  modern  protection  given  by  the  policies  you  issue. 
Let  your  policyholders  understand  that  every  tax  imposed  in- 
creases their  premiums.  Let  them  insist  that  any  payment  be- 
yond a  property  tax  except  that  covering  the  actual  cost  of 
supervision  and  inspection,  is  unjust.  Let  their  concentrated 
power  be  employed  legitimately  to  the  end  that  state  legislatures 
and  congress  may  not  increase  the  cost  of  insurance  under  the 
short-sighted  policy  of  raising  further  revenues  in  excess  of  prop- 
erty tax  from  life  insurance.  To  the  diffusion  of  this  information 
each  agent  and  officer  of  your  companies  may  properly  lend  him- 
self. 

Any  tax  upon  the  business  done  in  one  state  becomes  a  cost 
element  in  the  premium  collected  in  all  other  states.  The  legis- 
lature of  one  state,  therefore,  becomes  national  in  its  necessary 
effect.  If  one  state  taxes  life  insurance  done  within  its  borders 
by  foreign  companies  and  another  does  not,  the  citizens  of  the 
latter  state  thereby  are  taxed  by  the  former  state.  This  becomes 
a  direct  incentive  to  a  state  collecting  nothing  or  a  low  revenue 
from  foreign  companies  to  lay  a  tax  or  increase  their  exactions 
so  that  it  may  receive  its  share  of  the  taxes.  This  has  led  in 
some  instances  to  discriminations  and  reprisals.  It  has  imposed 
the  most  embarrassing  variety  c*  laws  upon  life  insurance  com- 
panies. 

The  United  States  possesses  that  uniformity  of  climate,  race, 
occupations  and  sanitarv^  conditions  that  the  cost  of  life  insur- 
ance is  uniform  and  national  and  not  accidental  and  local.  As 
a  preservative  element  in  the  problem  of  self-support,  it  is  na- 


WORLD'S  INSURANCE  CONGRESS  95 

tional ;  as  an  ally  in  warring  against  the  evil  of  poverty  and  want, 
it  is  national. 

The  regulations  under  which  life  insurance  business  is  done 
ought  to  be  national  and  not  local.  It  has  risen  to  the  dignity, 
importance  and  power  of  a  national  undertaking.  It  totals,  meas- 
ured by  money  alone,  more  than  the  transportation  lines  of  the 
United  States.  No  single  line  of  human  effort  reaches  so  gener- 
ally every  walk  and  condition  of  life.  Not  a  bushel  of  corn  can 
be  turned  into  distilled  liquor  without  the  regulation  of  Congress. 
Not  a  cigar  can  be  rolled  and  sold  without  the  watchful  eye  of 
the  Government.  Still,  the  hundreds  of  millions  of  investments 
that  safeguard  life  insurance  contracts,  the  many  hundreds  of 
millions  of  policies  carried,  the  vast  possibilities  entailed  are  with- 
out a  single  regulation  of  Government  of  the  United  States. 

It  is  proper  now  to  institute  a  movement  so  to  amend  the  Fed- 
eral Constitution  as  to  give  Congress  such  power.  Let  it  be  done 
intelligently  and  in  the  name  of  justice.  A  united  effort  will 
succeed.  Temporary  defeat  must  not  discourage  but  serve  as 
the  motive  for  future  increased  effort. 


SERVICE  PERFORMED  BY  FIRE  INSURANCE 
COMPANIES 

By  R.  W.  Osborn 
President,  Board  of  Fire  Underwriters  of  the  Pacific 

The  progress  of  mankind  is  marked  by  certain  ethnical  periods 
that  are  well  defined.  From  the  primitive  savage  to  a  barbarism 
of  the  lowest  type,  proceeding  thence  with  long  intermediate 
periods  to  the  Greeks  of  the  Homeric  Age,  on  to  the  Hebrews  of 
the  time  of  Abraham,  drifting  to  our  own  times  until  we  breathe 
the  atmosphere  of  a  present  civilization  and  achievement. 

Whether  in  the  mind  of  the  savage,  the  barbarian,  the  Greek  or 
the  Hebrew,  there  was  inherent  the  natural  law  for  the  preserva- 
tion of  life.  The  savage  had  a  very  vague  idea  of  property  rights 
and  the  barbarian  little  if  any  better.  Pass,  however,  from  those 
periods  long  antedating  the  Homeric  Age,  and  you  will  observe 
as  you  proceed  that  property  became  a  thing  of  value  and  there 
developed  the  strong  instinct  for  its  preservation.  It  is,  there- 
fore, quite  natural  that  these  people  should  have  thought  of  pre- 
serving the  integrity  of  their  possessions  and  of  their  lives.  In- 
stinctively the  mind  began  to  devise  means  whereby  these  two 
possessions,  so  sacred  to  them,  should  be  protected.  Life  was  para- 
mount and  was  guarded  by  physical  means,  such  as  usually  would 
be  suggested  to  undeveloped  yet  growing  minds. 

As  society  emerged  from  its  primitive  state  and  assumed  a  co- 
hesive attribute,  law  commenced  to  find  its  way  into  definite  ex- 


96  AVORLD'S  INSURANCE  CONGRESS 

pressiou,  and  laws  were  conceived  and  framed  to  protect  life  and 
property.  It  was  evident,  however,  as  time  passed  on,  that  law 
alone  could  not  prevent  the  destruction,  by  the  elements,  of  one's 
holdings.  This  in  turn  prompted  the  ingenuity  of  the  ancients  to 
suggest  some  form  of  associated  effort. 

Three  or  four  thousand  years  ago  Assyria  developed  the  mu- 
tual contribution  plan,  taxing  the  community  in  order  to  reim- 
burse the  individual  loser.  Greece  and  Rome  gave  expression  to 
this  principle  by  similar  methods. 

In  the  Middle  Ages  mutual  insurance  was  more  or  less  the 
vogue.  The  lords  of  Russia  rebuilt  the  houses  of  their  serfs. 
Flanders  about  the  13th  century  operated  along  these  lines,  the 
whole  community  sharing  in  the  individual  loss.  During  the 
Anglo-Saxon  period  the  idea  of  insurance  began  to  assume  defi- 
nite shape.  Guilds  that  were  formed  for  protection  and  improve- 
ment included  the  principle  of  insurance.  All,  however,  were 
based  upon  the  mutual  plan  of  contributorship.  In  England  hun- 
dreds of  these  guilds  were  in  existence,  confining  their  operations 
to  particular  hamlets  or  districts. 

Wherever  we  find  human  activity,  there  is  developed  resource- 
fulness dependent  upon  well  defined  natural  laws. 

The  mind  of  the  Eskimo  is  less  fertile  than  of  one  who  lives  in 
the  temperate  zone.  The_  mind  of  the  latter  reaches  the  highest 
possible  standard,  while  under  the  tropics  it  becomes  sluggish  and 
inert.  In  the  two  extremes  mental  development  finds  little  en- 
couragement from  natural  influences.  In  these  extremes  the  law 
of  statics  is  the  moving  force,  while  in  the  other  dynamics  is  the 
irresistible  power  impelling  a  mutual  development  measured  only 
by  human  limitations. 

The  development  of  the  idea  of  protection,  while  instinctive  in 
all,  is  less  so  in  the  polar  and  torrid  habitant,  but  has  reached 
a  very  high  standard  in  him  who  dwells  within  the  temperate 
clime. 

The  foregoing  is  designed  merely  to  move  the  mind  to  a  proper 
understanding  of  the  fundamental  idea  of  insurance  as  a  natural 
outgrowth  of  human  instinct  and  its  development. 

As  time  passed  on  and  property  became  more  real  as  a  pos- 
sessory right,  the  natural  instinct  for  its  preservation  became 
more  vital.  The  more  the  people  found  Avays  and  means  for  pro- 
tection, the  more  universal  it  naturally  became. 

In  the  early  days  of  this  contributorship,  reimbursement  was 
gratuitous,  resting  upon  the  desire  of  the  many  to  help  the  un- 
fortunate few  in  return  for  similar  help.  Gradually,  however, 
the  plan  became  extended  and  developed  from  its  abstract  form 
into  a  concrete  idea.  Capital  was  engaged  and  insurance  com- 
panies were  formed  to  undertake  the  burden  theretofore  assumed 
through  mutualism. 

One  hundred  years  ago  the  business  transacted  between  insur- 
ance companies  of  the  world  was  most  limited,  as  indeed  the  want 


WORLD'S  INSURANCE  CONGRESS  97 

for  it  was  correspondingly  measured,  but  in  the  past  half  cen- 
tury the  demand  has  grown  enormously.  The  commercial  devel- 
opment of  the  countries  of  Europe  with  that  of  our  own  great 
empire  of  industry  has  not  only  created  a  constant  demand  for, 
but  made  imperative  by  reason  of  business  necessit}^  the  organi- 
zation of  gigantic  capitalization  to  provide  for  this  great  eco- 
nomic shield. 

The  commerce  of  the  world  is  engaged  largely  through  credit, 
it  is  capitalized  and  operated  through  expectancy  and  therefore 
the  enormous  debit  balance  must  be  guarded  by  this  aegis  of  pro- 
tection— the  fire  policy. 

Admitting,  however,  that  each  dollar  of  debt  was  backed  b}'  its 
equivalent  in  gold,  yet  this  protection  is  equally  vital  if  for  no 
other  reason  than  to  maintain  as  economic  parity. 

Insurance  is  neither  more  nor  less  than  a  distributed  tax,  as- 
sessed against  the  communities  of  state  or  nation,  and  by  reason 
of  this  it  assumes  the  function  of  a  general  assessment.  Classes 
of  risks  are  segregated  and  their  relative  hazards  appraised  to 
the  end  that  each  will  bear  its  due  proportion  of  the  burden,  with- 
out taxing  unfairly  the  lesser  forms  of  hazard.  But  tax  it  is  and 
distribution  is  its  cardinal  feature.  Thus  we  see  a  pre-eminent 
service  performed  in  so  measuring  the  tax  and  providing  for  its 
equal  distribution  over  great  numbers  of  people  and  risks. 

We  are  wont  to  refer  to  the  classic  period  of  Greece  with  its 
wealth  of  architectural  beauty,  to  the  Elizabethan  Era  with  its 
refinements  in  literature,  to  the  Victorian  Age  in  which  achieve- 
ments typify  a  marvelous  growth  in  science,  literature,  art,  and 
commerce ;  but  does  not  the  mind  become  exalted  and  the  eye  look 
aghast  at  this  prophet  of  all  ages,  the  great  dynamic  Twentieth 
Century ! 

Who  can  visualize  it?  who  possibly  describe  it,  or  even  dream 
of  its  inchoate  plans,  which  like  a  thousand  arms  are  outstretched 
to  give  comfort  to  mankind?  It  is  a  mighty  age  fraught  with 
mighty  consequences,  and  underwriting  plays  no  unimportant 
part  in  this  great  scheme  of  development. 

As  we  retrospect  some  thirty  or  forty  years,  behold  a  crude  and 
unscientific  method  underlying  the  profession  of  underwriting. 
Complex  hazards  were  commencing  to  menace  the  economic  fabric 
of  an  infant  industrial  era,  an  imperfect  idea  was  attempting  to 
correct  and  arrest  the  onward  march  of  a  wonderful  age  and  a 
reckless  guess  was  hazarded  by  us  in  estimating  the  cost.  Fire 
departments  were  more  political  than  civic  organizations,  poorly 
equipped  and  most  inefficiently  conducted.  Building  laws  were 
crudely  drafted  and  criminally  executed  and  this  with  a  iiiost 
shameful  indifference  on  the  part  of  the  people. 

Underwriting  was  confronted  by  these  conditions  and  I  may 
add,  required  to  carry  them  along  against  an  adverse  tide,  with- 
out remedial  effort  on  the  part  of  the  state  or  country  and  without 


98        WORLD'S  INSURANCE  CONGRESS 

itself  being  adequately  constituted  to  unload  its  burden  by  cor- 
rective influence. 

Underwriting  organization,  by  persistent  courage  and  by  in- 
fluence of  a  positive  character,  has  brought  communities  to  a 
fuller  sense  of  cooperative  effort,  and  they  have  responded  with 
more  or  less  earnestness  to  constructive  suggestion — not  at  first, 
however,  without  hostility  and  provoking  organized  resistance. 
It  is  quite  human  to  protest  against  taxation,  and  the  average 
man  feels  all  taxes  as  an  arbitrary  subtraction  from  his  bank  ac- 
count. But  apart  from  life  insurance,  I  know  of  no  system  of 
taxation  so  accurate,  so  thoroughly  distributive,  and  so  devoid 
of  human  error  as  the  measurement  of  rate  for  fire  insurance 
assessment.  In  passing  it  must  be  admitted  that  until  within  a 
comparatively  short  time,  making  rates  was  a  system  of  guessing 
— system  we  call  it  because  it  did  possess  some  semblance  of  or- 
ganized method,  but  withal  it  was  a  guess  and  served  indifferently 
to  create  a  fair  parity  between  loss  and  profit.  But  the  last 
twenty-five  years  have  been  prodigious  factors  in  developing  new 
hazards,  new  processes  and  introduction  into  human  activity  of 
unappreciated  and  misunderstood  elements. 

These  in  turn  required  treatment  and  the  application  of  new 
principles  at  once  perplexing,  and  at  times  experimental. 

The  National  Board,  through  its  elaborate  corps  of  engineers, 
has  served  immeasurably  in  correcting  conflagration  tendencies. 
Rating  bureaus  have  done  still  more  by  inculcating  the  theory  of 
resistance  by  proper  construction  and  fire  protection,  through 
closer  analysis  of  different  risks.  Inspection  bureaus  have  proven 
a  public  blessing  in  their  positive  and  corrective  influence,  while 
laboratories  are  the  acme  of  engineering  skill  and  are  serving  an 
unmeasured  purpose  in  the  economy  of  industrialism.  All  of 
these  are  but  arteries  through  which  the  life  blood  of  the  great 
system  is  flowing. 

These  various  branches  of  the  business  are  working  intelligently 
for  constructive  results,  each  specializing  along  fundamental  lines 
and  each  achieving  a  success  in  the  ration  of  the  resistive  force 
opposing  it. 

Let  us  be  frank  and  investigate  this  resistance,  and  endeavor 
by  analysis  to  discover  what  is  its  source,  and  also  to  relatively 
assess  the  value  of  such  opposition. 

We  are  unquestionably  undergoing  an  evolution,  modified  by 
change  and  conditions  from  both  within  and  without,  and  it  is 
strange  how  much  of  the  movement  "without"  has  to  do  with  the 
one  "within." 

Some  forty  years  ago  the  non-uniformity  of  policy  conditions 
was  a  source  of  endless  trouble  and  public  criticism,  the  non- 
concurrence  of  policy  forms  gave  rise  to  dispute  and  litigation. 
Public  temper  was  so  keyed  up  as  to  make  it  imperative  that 
a  change  should  take  place.  The  companies  themselves  aimed 
to  meet  that  opposition  by  mutually  agreeing  to  a  policy  uniform 


WORLD'S  INSURANCE  CONGRESS  99 

in  its  conditions,  and  this  worked  fairly  well  for  a  while.  Finally 
the  States  began  to  legislate  on  this  subject  with  the  result  that 
a  large  number  of  States  have  adopted  a  form  of  policy  the  use 
of  which  is  mandatory;  but  the  legislation  merely  accelerated 
a  process  already  begun,  one  that  was  inevitably  coming  by  force 
of  a  natural  and  consistent  evolution. 

Then  followed  a  similar  popular  protest  against  the  business 
generally  for  an  alleged  lack  of  faith  in  the  adjustment  of  losses, 
and  it  may  be  quite  true  that  there  were  many  instances  when 
the  adjustment  of  loss  did  not  redound  to  the  credit  of  the  com- 
pany ;  but  when  we  consider  the  millions  of  cases  handled,  the  real 
number  of  bad  adjustments  was  in  reality  small,  if  not  insig- 
nificant when  compared  with  the  whole.  However,  it  must  not  be 
permitted  to  pass  unnoticed  that  a  very  large  number  of  "bad 
adjustments"  were  inspired  by  "bad"  losses,  when,  if  the  inscrut- 
able eye  of  Providence  had  revealed  the  facts,  they  would  prove 
anything  but  a  halo  encircling  the  heads  of  innocent  claimants. 
This  is  a  truth  expressed  with  far  more  moderation  than  restraint. 
But  the  spirit  of  competition  alone  has  so  modified  the  practice 
of  the  past,  that  if  the  companies  were  not  inspired  by  a  high 
standard  of  moral  consideration,  they  could  not  afford  to  ignore 
both  the  letter  and  the  spirit  of  the  contract,  with  a  gratuity 
added  to  accelerate  the  appetite.  But  it  is  my  observation  that 
a  very  measurable  standard  of  justice  and  equity  is  the  moving 
factor  with  underwriting  in  respect  to  fulfilling  the  obligations  of 
the  contract.  It  has  required  no  law  to  accomplish  this;  by 
simply  an  awakening  through  the  evocatory  agency  of  honor  itself 
has  this  been  brought  about. 

Then  the  question  of  rating,  the  tax  imposed  upon  the  public, 
was  the  bone  of  contention.  A  hundred  years  ago  the  rate  prob- 
lem was  more  easily  solved,  because  the  hazards  insured  against 
were  far  less  varied  and  infinitely  less  complex.  Risks  were  re- 
solved into  few  classes  and  those  classes  were  rated  very  largely 
upon  a  community  of  interest. 

As  the  great  human  activities  in  commerce  and  industrialism 
began  to  develop,  new  processes  and  complicated  equipment  for 
their  operation  produced  new  and  equally  complicated  hazards, 
requiring  the  application  of  great  study  and  thought  in  their  ad- 
justment to  rate.  At  this  juncture  a  more  refined  system  of  rat- 
ing became  the  vogue,  which  in  turn  suggested  still  further  refine- 
ments until  a  reasonably  scientific  basis  for  measuring  the  fire 
hazard  was  possible. 

Burke,  quoting  Sully,  said :  "  It  is  never  from  a  desire  to  attack 
that  the  people  rise,  but  from  an  impatience  under  suflPering." 
Of  course,  that  had  reference  to  the  political  aspect  of  society 
and  not  the  economic,  but  it  is  quite  relevant  here  for  this  dis- 
cussion. Under  former  systems  of  rating,  discrimination  was 
more  or  less  rife,  not  only  possibly  but  actually  so,  and  led  to 
a  popular  cry  that  the  rich  were  benefited  by  exactions  from  the 


100       WORLD'S  INSURANCE  CONGRESS 

poor.  That  there  were  discriminations,  was  both  possible  and 
probable,  we  may  say  inevitably  so,  for  if  hazards  were  not  then 
a  subject  for  measurement  it  was  not  unlikely  that  wholesale  in- 
demnity was  subject  to  the  same  economic  laws  as  merchandising. 
But  in  the  course  of  its  evolution,  rating  by  guess,  or  possibly 
in  some  cases  by  auto-suggestion,  became  superseded  by  a  very 
fair  system  of  measurement,  whereby  the  relativity  of  hazards 
became  possible  of  comparison  with  proper  deductions. 

Dissatisfaction,  however,  once  sown,  is  difficult  to  change.  It 
requires  much  time  to  convince  an  impressioned  public  that  a  sys- 
tem discarded  is  made  any  better  by  a  new  one,  and  especially 
when  you  consider  the  fact  that  it  involves  technique  which  only 
the  initiated  can  understand.  Hence  this  dissatisfaction  in  the 
public  mind  gave  rise  to  the  cry  "Down  with  the  trusts"  and 
placed  in  the  hand  of  the  cheap  politician  another  means  of  ex- 
istence, and  now  it  is  the  vogue  that  the  State  should  interfere. 
It  was  Guizot  who  said,  "It  is  a  gross  delusion  to  believe  in  the 
sovereign  power  of  political  machiner^^, ' '  and  Spencer  has  declared 
a  fundamental  truth :  ' '  Let  a  people  believe  in  governmental 
omnipotence,  and  they  will  be  pretty  certain  to  get  up  revolu- 
tions to  achieve  impossibilities.  Between  their  exorbitant  ideas 
of  what  the  state  ought  to  do  for  them  on  the  one  side,  and  its 
miserable  performance  on  the  other,  there  will  surely  be  generated 
feelings  extremely  inimical  to  social  order."  Political  and  gov- 
ernmental interference  approached  the  "danger  zone,"  for  what 
is  a  life  study  w^ith  the  underwriter  cannot,  with  any  measure  of 
success,  be  a  mere  avocation  of  a  politician — not  unlike  giving 
speech  to  an  ass  and  putting  wisdom  in  the  head  of  a  nail.  This 
tendency  is  insidious  and  like  the  quitch  grass  burying  its  ten- 
tacles in  the  ground,  the  public  will  yet  awaken  to  find  the  great 
modern  system  of  indemnity  befouled,  if  not  completely  ruined. 

By  a  wonderfully  progressive  movement,  underwriting  is  ap- 
proaching the  standard  of  a  science  and  must  be  left,  within  itself, 
to  work  out  its  own  problems. 

The  politician  is  never  constructive  in  his  work,  and  with  his 
selfish  conceit  would  turn  back  the  hands  of  progress  and  bring 
to  our  eyes  pictures,  such  as  may  have  been  seen  when  wolves 
howled  on  the  hills  of  Rome  and  when  slaves  worked  the  quarries 
of  Syracuse. 

Little  credit  is  given  to  underwriting  for  the  wonderful  forces 
of  to-day.  The  education  going  on  under  its  guidance  and  initia- 
tion is  little  short  of  marvelous.  Engineers  are  constantly  study- 
ing methods  of  construction,  the  chemist  is  regularly  in  touch 
with  the  great  sy.stem  of  underwriting.  Every  city  and  town  will 
trace  the  development  of  its  fire-lighting  facilities  to  the  door  of 
the  underwriter,  where  every  facility  is  afforded  the  public  for 
progressive  ideas.  TTnder  the  present  system,  rate  is  so  closely 
attuned  to  hazard  that  almost  every  Iniman  activity  comes  under 
the   guiding   influence   of   und.erwriting  organization.      Publicity, 


WORLD'S  INSURANCE  CONGRESS  101 

another  and  independent  factor,  is  exerting  wide  influence  through 
the  various  channels,  and  insurance  interests  are  endeavoring, 
through  every  artery  of  the  business,  to  educate  those  who  wish 
to  profit  by  the  experiences  in  our  business.  Analyze  any  form 
of  schedule  prepared  by  a  rating  board  and  note  the  constructive 
detail  in  which  no  defect  of  hazard  is  overlooked.  Visit  the  labo- 
ratories and  observe  the  tests  and  one  will  at  once  be  amazed  at 
the  constantly  accruing  knowledge  which  is  being  gained  and  given 
to  the  public.  It  seems  to  be  a  misconception  in  the  mind  of  the 
people  to  the  effect  that  high  rates  are  productive  of  big  profits, 
while  the  reverse  is  true.  Assumed,  of  course,  that  low  rates 
are  based  on  low  potentials  of  hazard,  so-called  low  rated  risks 
are  always  more  profitable  than  their  truant  brothers  and  if  for 
no  other  reason  in  the  world  than  that  rate,  being  a  system  of 
measurement,  indicates  the  quantity  of  hazard  within  a  risk. 

Notwithstanding  this  vast  machinery,  the  high  order  of  intelli- 
gence and  the  wonderful  supervision  in  the  business,  this  country 
has  not  achieved  a  success  that  both  this  expenditure  of  money 
and  brain  would  dictate  as  possible. 

The  enormous  fire  waste  of  this  country  is  slowly  but  surely 
undermining  the  industrial  and  economic  life  of  society.  We  can 
no  more  continue  this  devastation  of  wealth  and  withstand  its  con- 
sequences than  can  a  bank  outlive  the  "run"  in  times  of  panic. 
Instead  of  devoting  so  much  thought  and  energy  to  uprooting 
fundamental  principles,  the  modern  legislature  can  prove  a  bene- 
fit to  society  by  inaugurating  some  laws  to  control  the  profligacy 
of  our  people  and  the  waste  of  the  nation. 

Notwithstanding  the  impelling  force  in  underwriting  toward 
better  construction,  aiming  to  eliminate,  or  at  least  modify,  ex- 
treme hazards  and  with  the  great  up-building  influence  reflected 
in  the  fire  departments  commencing  with  the  village  and  ending 
with  the  great  metropolis,  yes,  notwithstanding  all  this,  there  is 
yet  an  underdevelopment  in  civic  responsibility  and  in  the  con- 
ception of  the  social  duty  we  owe  to  the  state.  We,  clay-made 
tenants  of  a  rapid  age,  seem  to  ignore  the  supremest  tests  by 
which  a  nation  is  conserved.  Stringent  laws  such  as  exist  in 
European  States,  while  apart  from  the  essential  features  of  our 
liberties,  yet  reflect  the  duty  we  owe  to  the  economic  fabric  of 
society. 

Notwithstanding  the  frightful  drain  upon  our  resources,  in- 
surance organization  has,  through  a  supreme  intelligence,  been 
able  to  construct  a  system  of  protection  unequaled  in  the  history 
of  the  world  and  not  equaled  by  governmental  regulations  in 
other  respects.  It,  therefore,  is  little  short  of  a  miracle  that  the 
insurance  interests  have  been  able  to  withstand  this  strain  and  to 
build  so  as  to  rear  a  monument  dedicated  to  all  vital  interests  and 
operating  to  create  confidence  in  the  great  commercial  activities, 
which  in  turn  install  the  peace  and  serenity  most  abiding  in  its 
character.     Whether    from    the    spear-tipped    fire    that    courses 


102       WORLD'S  INSURANCE  CONGRESS 

through  the  air,  or  the  self-immersed  torch  of  the  bloody  incen- 
diary, underwriting  stands  ready  to  do  its  office. 

When  the  fire-fiend  throws  his  stream  of  flame  into  the  great 
industrial  centers,  conflagration  results,  and  when  we  view  the 
great  conflagrations  of  this  country,  we  are  paralyzed  with  the 
thought  of  the  terrible  loss  to  life  and  property,  and  yet  Insur- 
ance stands  like  the  Colossus  of  Rhodes,  and  the  great  stream  of 
claimants  pass  beneath  its  beacon  light  and  are  served  as  at  no 
other  time  in  the  history  of  man. 

A  partial  review  of  the  more  important  conflagrations  of  our 
own  country  reveals  some  twenty-four  since  the  Chicago  fire,  in- 
volving hundreds  of  millions  of  dollars  to  insurance  interests. 
The  most  notable  were  Chicago,  Boston,  Jacksonville,  Paterson, 
Baltimore,  San  Francisco  and  Chelsea,  but  there  are  others  which 
need  not  blush  in  the  comparison.  The  most  frightful  of  all  was, 
of  course,  that  of  this  City,  in  which  the  insurance  companies 
redeemed  through  their  obligations  over  one  hundred  and  eighty 
million  dollars.  It  must  be  remembered  that  in  the  Baltimore  fire 
some  forty-five  millions  of  loss  were  sustained  by  insurance  com- 
panies and  this  only  preceded  the  San  Francisco  conflagration  by 
two  years,  yet  underwriting  interests  were  in  a  position  after  the 
one  staggering  blow  to  meet  the  greater  and  more  crushing  one. 
The  toll  was  heavy. 

Is  this  not  achievement?  Does  not  this  excite  the  admiration 
of  thinking  men  and  should  we  not  feel  proud  that  each  of  us 
has  given  life  and  thought  to  the  development  of  a  great  system 
that  can  do  these  things,  prove  a  mighty  aegis  of  protection  and 
yet  survive  to  continue  that  confidence  which  in  turn  makes  the 
great  commercialism  of  the  world  pursue  its  daily  work,  con- 
inced  that  o'er  the  towering  frame  of  commerce  is  erected  that 
great  shield  which  underwriting  has  reared?  The  profession  to 
which  we  owe  allegiance  has  by  no  means  reached  that  stage  of 
perfection  where  captious  criticism  may  not  be  incited  or  where 
honest  difference  of  opinion  may  not  be  invoked,  but  it  is  moving 
onward  and  upward  and  bravely  endeavoring  to  solve  its  own  deep 
problems,  and  it  may  be  counted  upon  to  achieve  its  victory. 


SERVICE  PERFORMED  BY  SURETY  COMPANIES 

By  Frank  L.  Gilbert 
Vice  President,  National  Surety  Company 

I  have  been  requested  to  address  you  upon  the  subject:  "Ser- 
vice performed  by  Surety  Companies",  bringing  to  the  fore  the 
part  that  Surety  Companies  play  in  conserving  and  bettering 
citizenship,  the  cementing  of  family  ties,  preventing  poverty,  the 
upholding  of  law   and   order,   maintaining  credit,   uplifting  the 


WORLD'S  INSURANCE  CONGRESS  103 

individual  in  the  eyes  of  himself  and  his  community  and  ulti- 
mately acting  as  a  binder  which  draws  men  together  for  a  har- 
monious perpetuation  of  peaceful  pursuits. 

Owing  to  the  short  time  allowed  me  for  preparing  this  address, 
I  have  used  many  thoughts  and  expressions  of  others  and  gladly 
give  them  credit  now. 

Not  until  now  have  I  ever  considered  how  extensive  are  the 
ramifications  of  the  influences  of  our  business,  but  before  going 
into  the  specialties  permit  me  to  give  you  a  little  history  of  the 
surety  business.  Our  first  record  of  advices  against  becoming 
Surety  is  found  in  the  Bible.  Proverbs,  Chap.  6,  first  verse,  says: 
"My  son,  if  thou  be  surety  for  thy  friend,  if  thou  hast  stricken 
thy  hand  with  a  stranger,  thou  art  snared  with  the  words  of  thy 
mouth."  Proverbs,  Chap.  22,  26th  verse:  "Be  not  thou  one  of 
them  that  strike  hands  or  of  them  that  are  sureties  for  debts." 
Proverbs,  Chap.  17,  18th  verse:  "A  man  void  of  understanding 
striketh  hands  and  becometh  surety  in  the  presence  of  his 
friends."  Proverbs,  Chap.  20,  16th  verse:  "Take  this  garment 
that  is  surety  for  a  stranger."  Proverbs,  Chap.  11,  15th  verse: 
*  *  He  that  is  surety  for  a  stranger  shall  smart  for  it ;  and  he  that 
hateth  suretyship  is  sure."  Even  the  advice  of  Sir  "Walter 
Raleigh  went  unheeded  for  years.  His  warning  is  as  follows: 
"If  any  desire  thee  to  be  his  surety,  give  him  a  part  of  what  thou 
hast  to  spare ;  if  he  press  thee  farther,  he  is  not  thy  friend  at  all, 
for  friendship  rather  chooseth  harm  to  itself,  than  offereth  it.  If 
thou  be  bound  for  a  stranger,  thou  art  a  fool;  if  for  a  merchant, 
thou  puttest  thy  estate  to  learn  to  swink ;  it  for  a  churchman,  he 
hath  no  inheritance;  if  for  a  lawyer,  he  will  find  an  evasion  by 
a  syllable  or  word  to  abuse  thee ;  if  for  a  poor  man,  thou  must  pay 
it  thyself ;  if  for  a  rich  man,  he  needs  not — therefore,  from  surety- 
ship, as  from  a  manslayer  or  enchanter,  bless  thyself;  for  the 
profit  and  return  will  be  this — that  if  thou  force  him  for  whom 
thou  art  bound,  to  pay  it  himself,  he  will  become  thy  enemy;  if 
thou  use  to  pay  it  thyself,  thou  wilt  become  a  beggar." 

Notwithstanding  all  this  very  good  advice,  it  was  not  until  1851 
that  capital  could  be  interested  in  America  in  the  formation  of 
companies  to  relieve  personal  sureties  of  responsibility  and  losses. 
In  that  year  the  Guarantee  Company  of  North  American  was 
organized  in  Montreal,  Canada.  The  first  company  writing 
fidelity  insurance  in  the  United  States  is  the  Fidelity  and  Casu- 
alty Company  of  New  York,  organized  in  1876,  transacting  its 
first  business  in  1879.  The  American  Surety  Company  of  New 
York  was  incorporated  in  1884  and  for  several  years  these  com- 
panies had  a  monopoly  of  the  field.  In  1888  the  Missouri,  Kansas 
and  Texas  Trust  Company  of  Kansas  City  was  organized,  which 
in  1897  was  merged  into  the  National  Surety  Company  of  New 
York.  The  Fidelity  and  Deposit  Company  of  Baltimore  began 
business  in  1890,  the  American  Bonding  Company  of  Baltimore, 


104       WORLD'S  INSURANCE  CONGRESS 

Md.,  in  1894,  the  Title  Guaranty  and  Surety  Company  of  Scran- 
ton,  Pa.,  in  1901. 

In  1895  the  total  premium  receipts  of  all  companies  from  fidel- 
ity and  surety  lines  were  only  a  few  thousand  dollars  and  for  the 
year  1914  were  over  twenty  millions. 

The  growth  of  the  business  for  a  number  of  years  was  slow — 
the  public  had  followed  the  plan  of  giving  personal  sureties.  Yet, 
there  is  no  argument  to  support  the  personal  bond.  The  only  ex- 
cuse for  its  ever  having  existed  w^as  the  absence  of  its  corporate 
successor.  No  man  has  a  right  to  ask  his  friend  for  such  gratui- 
tous assistance.  No  man  is  justified  in  assuming,  for  another,  an 
obligation  which  hazards  his  estate  and  may  impoverish  his  family. 
Thousands  in  the  past  have  lost  their  all  through  the  signing  of 
bonds,  which  loss  is  now  obviated  through  the  medium  of  surety 
companies.  One  of  the  greatest  protections  against  poverty  to-day 
is  brought  about  through  the  service  given  by  surety  companies  in 
the  execution  of  thousands  of  bonds  throughout  the  United  States 
for  administrators,  executors  and  guardians.  By  exercising  rigid 
joint  control  of  the  assets  of  the  estate,  we  preserve  the  funds  and 
securities  for  the  heirs,  in  addition  making  the  line  a  very  profit- 
able one  for  the  companies. 

Surety  companies  are  always  opposed  to  gambling  in  any  form. 
In  the  fight  against  race  track  gambling,  the  surety  companies 
were  at  the  front  line  fighting  this  great  evil  and  not  entirely 
from  disinterested  motives.  In  an  editorial  in  the  Los  Angeles 
Express  of  March  3d,  1908,  there  appeared  the  following  eloquent 
testimony  from  the  President  of  a  surety  company:  "Do  you 
know,  I  estimate  that  fully  75  per  cent,  of  the  men  in  California 
whose  integrity  we  guarantee  and  who  go  wrong  are  tempted 
and  fall  through  betting  on  the  races."  And  I  want  to  say  to  you 
now, — that  since  the  race  track  was  put  out  of  business,  the  fidel- 
ity losses  have  been  reduced  to  such  an  extent  that  it  has  been 
possible  to  materially  reduce  the  rate  on  fidelity  risks. 

We  now  have  the  extreme  pleasure  of  saying  to  our  people  at 
the  home  offices  that  the  lotteries  in  San  Francisco  are  a  thing  of 
the  past.  This  sort  of  gambling,  while  not  as  bad  as  the  race  track, 
finds  its  victims.  In  a  case  now  pending  in  San  Francisco  a 
trusted  employee  has  defaulted  in  a  very  large  amount,  spending 
large  sums  monthly  for  lottery  tickets.  His  employers  are  pro- 
tected by  surety  bonds  in  several  companies— the  sufferers  being 
the  man's  family.  The  surety  companies  have  been  as  active  in 
helping  abolish  the  lotteries  as  in  the  case  of  the  race  track.  We, 
therefore,  make  our  claim  for  credit  in  upholding  hnv  and  order. 
Surety  proper  comes  under  a  different  classification  than  fidel- 
ity, and  covers  undertakings  more  in  the  nature  of  financial  guar- 
antees, or  credit  guarantees,  such  as  undertakings  on  appeal,  stip- 
ulations for  value,  bonds  guaranteeing  payment  of  freight  charges, 
etc.  One  of  the  most  hazardous  lines  is  the  bonding  of  contrac- 
tors on  construction  work.     In  California,  as  in  a  large  number 


WORLD'S  INSURANCE  CONGRESS  105 

of  States,  the  contractors'  bond  ^arantees  the  payment  of  all 
bills  for  labor  and  material  in  addition  to  the  completion  of  the 
work,  so  that  our  bond  is  one  that  guarantees  credit.  Material 
men  upon  finding  that  a  reliable  surety  company  has  executed 
the  bond  will  sell  him  readily  and  without  question.  The  surety 
companies  are  therefore  upholding  the  credit  of  the  contractors. 

In  many  of  the  States  the  laws  provide  that  a  treasurer,  or  other 
public  official,  may  deposit  the  funds  that  by  reason  of  his  office 
come  into  his  hands  in  a  bank  or  banks.  The  bank  in  turn  fur- 
nishes a  surety  company  bond  to  the  treasurer,  guaranteeing  the 
safe  return  of  the  funds  so  deposited.  By  this  method  of  ohtain- 
ing  credit,  the  bank  paj'S  a  small  premium  rate  on  the  average 
deposit,  thereby  avoiding  the  necessity  of  purchasing  municipal 
bonds  for  security,  which  bonds  fluctuate  in  price  and  are  some- 
times unsalable  without  loss. 

The  most  desirable  business  secured  by  a  surety  company  is 
guaranteeing  the  honesty  of  the  individual,  either  as  officer  or 
employee,  and,  as  the  bonding  of  emploj^ees  becomes  more  gen- 
eral, the  percentage  of  defalcations  decrease. 

The  average  bonded  man  is  honest.  It  may  be  in  some  instances 
that  he  is  prompted  to  be  faithful  and  honest  solely  through  fear 
of  arrest,  or  the  ruining  of  his  bond  record.  In  that  event,  the 
granting  of  suretyship  is  still  a  boon  even  though  it  awakens  fear 
rather  than  pride. 

The  good  result  to  all  concerned — to  the  employer,  the  surety, 
the  employee  himself,  the  employee's  relatives  and  friends — is  the 
same.  "Whatever  tends  to  the  keeping  of  faith  between  men  tends 
to  the  uplift  of  men  and  the  betterment  of  life. 

Surety  companies,  while  being  public  benefactors,  are  organized 
for  profit,  and  all  well  managed  surety  companies  are  dividend 
payers.  No  line  of  business  is  entirely  philanthropical.  Business 
is  business.  But  any  business  that  requires  in  its  operation  a 
large  measure  of  faith  in  mankind,  or  even  a  show  of  such  faith, 
and  which  is  calculated  to  put  a  premium  upon  proper  conduct 
and  decent  living,  loses  its  sordidness  in  a  large  measure.  It  has 
an  aspect  other  than  a  commercial  one. 

The  fact  that  such  a  line  of  business  when  carefully  handled 
may  be  made  profitable  should  not,  it  seems  to  me,  lessen  the  re- 
gard in  which  its  object  and  the  results  obtained  should  be  held. 
If  the  guaranteeing  of  another's  fidelity  has  become  less  hazardous 
to  the  guarantor  than  formerly,  it  is  the  very  character  of  the  busi- 
ness that  has  made  it  so.  To  place  trust  in  a  man  constitutes  an 
appeal  to  his  self-respect  which  might  otherwise  lie  dormant. 

Employers  are  more  and  more  recognizing  their  duty  towards 
those  eligible  to  suretyship,  and  the  poor  man  with  a  good  record 
back  of  him  gets  the  job.  Suretyship  is  a  moral  teacher.  Its  ten- 
dency is  to  promote  the  general  welfare  of  the  good  of  mankind. 
The  development  of  moral  sensibility — even  though  it  be  an  en- 
forced development  brought  about  through  fear  of  consequences — 


106       WORLD'S  INSURANCE  CONGRESS 

can  scarcely  fail  to  bring  with  it  a  higher  plane  of  living  resulting 
in  increased  happiness. 

In  conclusion — corporate  suretyship  came  into  being  as  the 
spoken  language  came:  Slowly,  gradually  and  to  meet  an  urgent 
need.  It  has  been  worked  for  evil  but  mostly  has  worked  for 
good.  It  is  a  vital  force  and  a  tower  of  strength.  If  you  do  not 
use  it,  you  work  against  the  aims  and  purposes  that  animate  your 
business. 

It  is  the  ambassador  of  civilization,  the  hand-maiden  of  thrift 
and  the  guardian  of  progress.  "With  its  aid  commerce  has  laid 
rails  across  the  continent  and  stretched  a  network  of  copper  into 
the  far  corners  of  the  globe.  It  has  built  great  cities  and  peoples 
them  with  happy  men  and  women  who  love  the  labor  it  insures. 
It  has  assisted  in  the  construction  of  the  great  Panama  Canal,  the 
completion  of  which  we  are  now  celebrating.  It  is  the  friend  of 
widows  and  orphans — its  promises  are  sought  alike  by  rich  and 
poor.  He  who  uses  it  is  wise,  for  it  has  made  possible  an  assur- 
ance of  peace  and  happiness  denied  the  King  of  yesterday.  It 
spells  economy,  abundance  and  security.  It  is  the  one  and  only 
universal  safeguard — Corporate  Suretyship. 


SERVICE    PERFORMED    BY   LIFE    INSURANCE 
COMPANIES 

By  Haley  Fiske 

Vice-President,  Metropolitan  Life  Insurance  Company 

(Read  by  Geo.  B.  Scott) 

The  following  introductory  paragraph  of  the  announcement  of 
the  day's  proceedings  is  a  succinct  statement  of  the  service;  and 
what  is  required  seems  to  be  set  forth  facts  which  justify  the 
thesis : 

"The  day  is  designed  to  bring  to  the  fore  the  part  that  insur- 
ance plays  in  conserving  and  bettering  citizenship  through  the  pro- 
longation of  life,  the  cementing  of  family  ties,  preventing  poverty, 
the  upholding  of  law  and  order,  maintaining  credit,  .  .  .  im- 
proving sanitation,  uplifting  the  individual  in  the  eyes  of  him- 
self and  his  community,  and  ultimately  acting  as  the  binder  which 
draws  men  together  for  a  harmonious  perpetuation  of  peaceful 
pursuits  upon  a  constructive  basis. ' ' 

Consider  first  how  widespread  in  the  community  is  the  insur- 
ance of  lives.  At  the  end  of  1914  there  were  40,391,856  policies 
in  force  in  the  United  States  and  Canada,  as  compared  with  a 
population  of,  say,  110,000,000.  We  estimate  that  these  forty  mil- 
lions of  policies  were  upon  twenty-five  to  thirty  millions  of  lives, 
and  therefore  that  about  a  quarter  of  the  population  is  insured. 


WORLD'S  INSURANCE  CONGRESS  107 

These  are  the  figures  of  244  regular  reserve  companies.  The  in- 
surance in  force  was  $22,342,611,750.  The  companies  are  exceed- 
ingly active  and  energetic  in  prosecuting  the  business.  There  was 
a  gain  of  nearly  two  and  a  half  millions  in  number  and  nearly 
two  billions  of  dollars  in  amount  of  insurance  in  force  during  the 
year  1914.  To  realize  the  significance  of  these  figures,  consider, 
next,  what  life  insurance  is.  Fundamentally  it  is  the  association 
of  numbers  of  people  who  realize  that  while  nothing  is  more  cer- 
tain than  death,  nothing  is  more  uncertain  for  each  healthy  in- 
dividual than  the  date  of  death ;  that  death  is  a  pecuniary  loss  to 
the  dependents ;  that  there  is  a  necessity  to  tide  over  a  period  dur- 
ing which  new  adjustments  can  be  made  in  the  lives  of  the  sur- 
vivors ;  that  for  this  period  assistance  is  needed.  The  contributions 
of  these  numbers  of  people  go  into  a  fund  out  of  which  this  help 
is  furnished.  Though  the  date  of  the  individual  death  in  uncer- 
tain, the  number  of  deaths  in  the  year  among  the  contributors  is 
quite  certain.  There  is,  therefore,  a  mathematical  relation  estab- 
lished between  the  amount  agreed  to  be  contributed  and  the  amount 
of  the  fund  to  be  drawn  upon  death.  The  uncertainty  of  the  date 
of  death  makes  life  insurance  a  very  human  thing.  It  used  to  be 
called  a  gamble.  Surely  it  is  not  that.  We  have  a  right,  after  all 
these  years  and  the  tremendous  extent  of  life  insurance,  to  say 
that  the  system  is  the  result  of  conscious  mutual  helpfulness.  It 
is  a  social  institution.  The  family  which  draws  a  death  benefit 
after  a  single  premium  is  not  drawing  charity.  The  obligation  of 
the  holder  of  the  policy  was  undertaken  in  good  faith  with  the 
view  of  helping  others,  and  the  help  from  others  arising  from  the 
unexpected  death  is  the  mere  fulfilment  of  an  obligation  which 
was  reciprocal.  No  doubt  when  a  man  insures  his  life  he  does  it 
to  protect  his  family  in  the  event  of  his  death ;  but  he  neither  ex- 
pects nor  desires  his  own  death,  and  he  has  a  consciousness  that 
he  is  making  a  mutual  bargain  to  give  or  take  help  as  the  event 
may  prove.  Life  insurance  is,  therefore,  a  brotherhood  whose 
operations  are  intensely  practical.  These  companies  distributed, 
during  1914,  $527,535,935.  Somebody  has  said  this  is  over  one- 
half  of  the  national  debt.  Think  of  the  excitement  the  Govern- 
ment would  arouse  if  it  undertook  to  pay  its  debt  in  a  single  year ! 
Think  of  the  taxation  necessary  to  enable  the  Government  to  do 
such  a  thing.  Yet  the  distribution  by  life  companies  of  over  half 
a  billion  dollars  in  a  year  causes  no  comment.  It  enters  into  the 
common  life  of  the  people,  affecting  enormous  numbers  of  them. 
We  may  take  it  that  this  money  went  to  the  families  of  nearly  a 
million  persons,  and  therefore  affected  four  or  five  millions  of  in- 
dividuals. And  this  is  an  annual  experience.  Multiply  it  by  ten 
years,  and  consider  what  a  common  daily  experience  is  the  knowl- 
edge by  our  people  of  the  results  of  this  system  of  association  for 
mutual  help. 

It  would  be  mere  commonplace  to  dwell  upon  the  good  done  by 


108  WORLD'S  INSURANCE  CONGRESS 

this  enormous  distribution  of  money,  in  relieving  want,  paying 
debts,  furnishing  future  support. 

Let  us  go  back  to  the  fund  out  of  which  these  payments  are 
made.  It  is  stupendous  in  amount.  The  assets  of  these  companies 
at  the  end  of  1914  were  $5,228,131,428.  They  increased  during 
the  3^ear  $321,684,415.  There  were  poured  into  this  fund  during 
the  year  $1,035,066,155,  of  which  $778,758,888  were  from  prem- 
iums. Of  the  total  assets  there  were  permanently  invested  in  re- 
serve required  by  law  to  meet  policy  obligations  the  sum  of  $4,341,- 
688,654;  the  increase  in  the  reserve  during  the  year  1914  was 
$251,140,370.  These  figures  are  so  large  as  to  benumb  us  if  we 
look  at  them  as  mere  accumulations.  We  must  consider  how  inti- 
mately into  the  daily  life  of  our  people  these  millions  and  millions 
of  dollars  enter.  In  no  other  way  may  we  appreciate  the  extent 
of  the  service  performed. 

Take  the  five  and  a  quarter  billions  of  assets.  It  is  probable 
that  thirty  per  cent,  of  these  are  invested  in  railway  securities, 
that  is,  one  and  a  half  billions  of  dollars  are  in  the  real  and  per- 
sonal property  of  railways.  The  first  thought  about  this  is  that 
the  insurance  business  has  been  the  most  important  single  instru- 
mentality in  developing  the  country ;  that  millions  of  acres  of  land 
have  been  thrown  open  to  cultivation;  that  the  coal,  the  ores,  the 
crops  have  been  wealth  added  to  the  country's  resources;  that 
enormous  populations  have  been  scattered  over  the  various  States; 
that  the  resulting  commerce  has  founded  and  built  up  the  cities 
of  the  country ;  that,  through  exports,  money  has  been  drawn  from 
all  the  world  and  millions  of  people  invited  to  our  shores  and  sent 
throughout  the  land. 

It  is  probable  that  thirty-five  per  cent  of  these  assets  are  loaned 
on  bonds  and  mortgages.  That  means  that  communities  have  been 
built  up  by  insurance  funds.  It  is  estimated  that  ten  per  cent. 
of  the  funds  are  invested  in  State,  county  and  municipal  bonds 
and  bonds  of  public  improvements.  That  means  that  communities 
have  been  developed  and  sustained,  and  have  been  furnished  with 
the  conveniences  of  modern  life  and  with  material  facilities  for 
the  education  of  children  by  the  insurance  companies.  This  con- 
structive work  is  continuous.  Under  the  reserve  system  of  insur- 
ance— more  than  four-fifths  of  the  assets  are  subject  to  reserve 
liabilities — the  total  reserves  of  the  companies  amounted  to  over 
four  and  a  third  billions  of  dollars  at  the  end  of  1914.  The  invest- 
ments are  stable.  They  increase  automatically,  like  the  rolling  of 
a  snow-ball.  IMore  than  three-quarters  of  the  semi-annual  interest 
receipts  are  added  to  the  reserve  and  in  turn  invested  and  held. 
]\Ioreover,  the  investments  are  made  where  they  are  most  needed. 
This  arises  from  self  interest,  because  obviously  the  best  rate  of 
interest  is  obtained,  as  a  rule,  where  capital  is  scarcest.  Mr.  Cox, 
of  the  Presidents'  Association,  in  analyzing  the  investments  of 
fourteen  large  United  States  companies,  found  that  five  per  cent, 
of  the  total  reserves  were  invested  in  the  Northwest  to  the  extent 


WORLD'S  INSURANCE  CONGRESS  109 

of  over  two  hundred  per  cent,  of  the  reserves  of  the  policies  issued 
to  those  States;  ten  per  cent,  in  the  Southwest  amounting  to  124 
per  cent,  of  the  reserves  of  the  policies  of  that  territory;  nearly 
twenty  per  cent,  in  the  Central  Northern  States  (Ohio,  Indiana, 
Illinois,  Wisconsin  and  Michigan),  being  114  per  cent,  of  the  re- 
serves required  by  the  policies  in  those  States;  seven  per  cent,  in 
the  South  Atlantic  States,  being  111  per  cent,  of  the  reserves  on 
their  policies ;  nearly  five  per  cent,  in  the  Pacific  States,  being  123 
per  cent,  of  the  reserves  on  Pacific  Coast  policies.  It  is  a  demon- 
stration that  the  insurance  companies  have  been  building  up  this 
vast  domain,  for  the  fourteen  companies  had  over  eight  hundred 
millions  of  dollars  invested  there. 

Probably  fifteen  per  cent,  of  the  assets  of  the  companies  are  in- 
vested in  policy  loans.  Leaving  aside  the  question  whether  it  is 
wise  for  either  the  company  or  the  borrowing  policyholders  that 
there  should  be  so  much  borrowing,  it  must  be  admitted  that  the 
loans  associate  company  and  policyholder  closer  together;  that 
the  return  of  seven  hundred  and  fifty  millions  of  dollars  collected 
in  premiums  to  those  M^ho  paid  them,  and  while  they  are  continu- 
ing their  policies,  means  an  increase  in  capital  resources;  that  the 
business  and  social  life  of  the  individual  are  profoundly  affected. 
He  spends  the  money  borrowed.  If  he  pays  future  premiums  with 
it,  he  keeps  his  family  protected ;  if  he  pays  debts,  he  releases  capi- 
tal and  carries  easier  the  burden  of  life;  if  he  buys  luxuries,  he 
thanks  insurance  for  his  keener  enjoyment ;  if  he  tides  over  loss 
of  income,  he  realizes  as  never  before  the  blessings  of  life  insur- 
ance. 

Let  us  go  deeper  into  the  relation  of  insurance  to  the  industrial 
life  of  the  people.  The  income  in  1914  of  the  244  companies  was 
over  a  billion  of  dollars,  of  which  nearly  780  millions  were  in  prem- 
iums. Of  this  billion  dollars  of  income  ($1,035,066,155),  twenty- 
five  per  cent,  was  added  to  reserve — $251,140,370 — and  invested  in 
the  upbuilding  of  our  material  resources;  fifty  per  cent. — $527,- 
535,935 — was  returned  to  policj^iolders  new  and  old.  Want  re- 
lieved, families  supported,  children  educated,  debts  paid,  invest- 
ments made  for  widow,  and  children — the  blessings  of  life  insurance 
have  so  often  been  explained  that  I  need  not  pursue  that  topic; 
seventeen  per  cent,  went  to  management  expenses — salaries,  wages, 
commissions — touching  the  community  on  all  sides  as  money  spent 
in  small  suras  inevitably  does;  about  one  and  a  half  per  cent. — 
say,  fourteen  millions  of  dollars — paid  in  taxes  on  premiums,  an 
amount  we  may  say  unjustly  assessed  upon  thrift,  but  which  went 
to  lighten  the  burdens  of  other  taxation  and  contributed  to  the 
carrying  on  of  civilized  life,  protection  of  property,  education, 
caring  for  the  sick. 

Perhaps  one  gets  a  clearer  conception  of  the  service  performed 
by  life  insurance  companies  when  he  studies  the  business  of  indus- 
trial life  insurance.  Three-quarters  of  all  the  policies  in  force  are 
industrial — thirty  millions  out  of  forty.    When  one  thinks  of  the 


110  WORLD'S  INSURANCE  CONGRESS 

service  performed,  the  number  of  individuals  affected  is  perhaps 
more  important  than  the  amount.  Is  it  not  a  startling  fact  that 
one  out  of  every  five  of  the  population  of  the  United  States  and 
Canada  holds  an  industrial  life  insurance  policy  and  weekly  pays 
his  premium  to  a  collector?  Can  any  one  institution  be  said  to 
be  as  close  to  the  people  as  that?  When  you  consider  that  in 
Philadelphia  and  some  other  cities  there  are  more  industrial  life 
insurance  policies  in  force  than  the  number  of  the  population,  you 
begin  to  get  an  inkling  of  how  close  to  the  life  of  the  people  life 
insurance  is.  But  it  is  not  only  the  number  of  policies,  but  the 
insurance  and  financial  exhibits  which  show  the  important  part  in 
the  life  of  the  people  life  insurance  plays.  In  number,  the  indus- 
trial policies  are  seventy-five  per  cent,  of  the  total;  in  amount  of 
iusui'ance  and  in  premium  income,  nearly  nineteen  per  cent. ;  or, 
including  the  ordinary  business  of  these  companies — and  by  far 
the  most  of  their  ordinary  business  comes  from  the  same  classes 
as  their  industrial — over  thirty  per  cent.;  in  payments  to  indus- 
trial policyholders,  twelve  per  cent.,  and  to  all  policyholders, 
twenty  per  cent. ;  in  reserve  accumulations,  twenty  per  cent.,  nearly 
equally  divided  between  industrial  and  ordinary;  in  assets  about 
twenty  per  cent. 

Let  us  analyze  the  system  of  industrial  insurance  and  follow  it 
out.  One  hundred  and  forty-four  millions  are  annually  collected 
in  weekly  installments.  This  involves  perhaps  eight  millions  of 
visits  weekly  by  agents — over  four  hundred  millions  of  visits  an- 
nually. The  agent  performs  all  the  services  required  by  the  policy- 
holder— he  collects  the  premiums,  pays  the  dividends  and  bonuses, 
calls  to  prepare  the  proofs  of  death  and  later  to  pay  the  claims. 
The  agent  enters  into  the  daily  family  life  of  the  wage-earners. 
He  knows  all  the  family,  their  joys  and  griefs,  their  income  and 
outgo,  their  pleasures,  their  work — their  very  life;  is  often  their 
adviser,  confident  and  friend;  and  always  in  a  representative  ca- 
pacity ;  he  is  what  he  is  to  those  millions  of  people  because  he  to 
them  is  the  company;  they  know  the  company  is  back  of  the 
agent;  agents  may  change,  but  the  company  is  always  with  them. 
People  pay  premiums  to  the  agents  and  the  collections  go  to  the 
insurance  fund — the  assets ;  the  assets  are  invested ;  part  of  them 
go  to  railway  treasuries;  part  to  governmental  officials;  part  to 
treasurers  of  public  utility  companies;  part  to  personal  borrowers 
on  mortgages.  But  these  recipients  do  not  keep  the  money. 
They  spend  it  in  materials  and  wages.  The  materials,  moreover, 
had  to  be  manufactured  by  wage-earners.  In  the  last  analysis, 
the  people  who  pay  the  premiums  get  the  premiums  back  in  wages. 
It  is  the  workmen  who  gets  metal  and  coal  out  of  mines,  who 
clears  forests,  who  fashions  lumber,  who  gathers  crops,  who  makes 
brick,  who  quarries  stone,  who  draws  rails,  who  casts  structural 
steel,  who  erects  buildings  and  lays  railway  lines  and  builds  loco- 
motives and  cars.  For  all  these  things  he  gets  paid  out  of  the 
assets  of  insurance  companies  invested  in  the  debts  of  his  employer. 


WORLD'S  INSURANCE  CONGRESS  111 

And  when  he  gets  his  wages  he  buys  food  and  clothing,  and  this 
involves  more  buildings  and  more  railways  and  more  cities  and 
towns  and  more  means  of  communication  and  more  public  utilities. 
And  with  part  of  his  wages  he  buys  insurance  and  pays  his  prem- 
iums and  increases  the  companies'  funds.  Thus,  money  he  pays  to 
insurance  companies  comes  back  to  him  in  wages.  An  endless 
chain?  No.  It  is  circulating  blood.  It  carries  on  the  life  of 
the  people.  Service  ?  It  is  civilized  life !  From  the  cradle  to  the 
grave  industrial  life  insurance  is  the  companion,  servant,  friend, 
benefactor  of  the  wage-earning  families.  It  makes  of  these  people 
a  capitalistic  class.  No  one  of  them  can  buy  a  bond,  but  two  hun- 
dred of  them  can  do  so  every  year,  for  their  collective  industrial 
premiums  will  then  have  amounted  to  $1,000.  A  million  of  them 
in  ten  years  will  contribute  enough  to  build  a  railway  halfway 
across  the  continent;  or  to  put  up  fifty  large  city  schools;  or  to 
run  a  subway  through  New  York;  or  to  supply  a  large  city  with, 
water;  or  to  build  20,000  homes  for  a  hundred  thousand  people — 
build  a  city !  It  is  not  only  that  they  can  do  it — they  do  it !  Con- 
sider the  assets  of  the  industrial  companies — one  thousand  millions 
of  dollars ! 

It  was  industrial  insurance  that  first  brought  the  service  of  life 
insurance  to  the  mass  of  the  people.  For  many  years  after  the 
system  of  life  insurance  was  inaugurated,  its  benefits  were  avail- 
able only  to  the  comparatively  well-to-do.  Wage-earners  had  re- 
course to  clubs  and  small  associations  which  distributed  benefits 
from  contributions,  either  periodical  or  on  call  when  needed,  from 
the  members.  Industrial  insurance  is  the  application  of  life  in- 
surance science  to  the  special  needs  of  working  people — namely, 
the  frequent  payment  of  small  premiums  collected  on  personal 
visitation  by  collectors.  That  thirty  out  of  forty  millions  of  poli- 
cies in  force  are  industrial  shows  the  extent  of  the  service.  An 
unknown  element  at  the  start  was  the  mortality  to  be  experienced ; 
and  .yet  mortality  experience  is  the  most  necessary  element  in  the 
practical  operation  of  life  insurance.  To  gain  knowledge  of  this 
element  took  many  years.  A  unique  service  has  been  the  return 
to  the  policyholders  of  the  excess  premiums  originally  fixed  high 
enough  to  insure  safety.  The  companies  were  stock  corporations 
organized  in  profit  to  the  shareholders.  We  have  seen  the  spectacle, 
new  to  business,  of  the  return  in  the  last  nineteen  years  of  forty- 
nine  millions  of  dollars  in  cash  by  one  company  to  its  policyholders 
over  and  above  the  obligations  of  the  contracts  which  were  non- 
participating;  besides  the  granting  of  concessions,  costing  four 
millions  more;  and  of  the  like  return  by  another  company  of 
twenty-one  millions  of  dollars.  The  latter  company  changed  its 
form  of  industrial  policies  after  1895  to  the  participating  plan. 
The  distribution  above  mentioned  was  to  non-participating  policy- 
holders. During  the  last  year  a  still  more  amazing  thing  has  hap- 
pened. The  stock  of  one  company,  two  millions  of  dollars,  with 
a  surplus   of  thirty-three  millions,   limited,   however,   to   annual 


112       WORLD'S  INSURANCE  CONGRESS 

dividends  of  seven  per  cent,  was  surrendered  to  the  policyholders 
at  three  times  its  par  value.  Financiers  have  called  this  a  gift, 
as  the  ultimate  legal  title  to  the  surplus  was  in  the  stock.  The 
stock  of  another  company,  also  two  millions  of  dollars,  with  a  sur- 
plus of  thirty-five  millions,  whose  stock  dividends  were  unlimited 
by  charter,  was  surrendered  to  the  policyholders  for  about  nine 
times  the  par  value ;  this,  in  the  face  of  dividends  declared  by  its 
namesake  in  England  amounting  annually  to  5,600  per  cent,  on  the 
cash  invested.  It  results  that  the  three  companies  which  together 
do  ninety-two  per  cent,  of  the  entire  industrial  insurance  now 
belong  to  the  policyholders.  There  is  something  impressive  about 
the  banding  together  of  the  holders  of  twenty-eight  millions  of 
industrial  policies  for  the  service  of  mutual  protection.  No  one 
can  estimate  the  service  to  the  American  and  Canadian  peoples  of 
this  system  of  insurance. 

A  recent  progressive  stage  of  life  insurance  is  what  is  practi- 
cally the  care  and  investment  of  savings  for  the  surviving  depend- 
ents— an  end  achieved  by  the  deposit  of  the  proceeds  of  a  policy 
with  the  company  which  pays  interest,  or  the  payment  of  the  pol- 
icy in  many  instalments.  The  amount  of  insurance  on  these  plans 
is  rapidly  increasing.  This  is  a  service  which  saves  dependents 
from  errors  of  judgment  and  exploitation  by  unwise  and  designing 
advisers. 

One  large  and  old  life  insurance  company  is  issuing  millions  of 
insurance  to  employees  covering  a  burial  fund  for  the  employee 
and  weekly  support  to  the  dependents,  the  premiums  paid  by  the 
employer.  Another  prominent  company  issues  policies  providing 
sick  benefits,  accident  indemnity  and  burial  fund.  These  policies 
may  be  collective,  issued  to  the  employer,  with  or  without  contri- 
butions from  the  employee.  Still  another  company  insures  its  six- 
teen thousand  of  employees  against  sickness  and  death,  the 
premiums  contributed  jointly  by  company  and  servant.  It  offers 
similar  insurance  to  all  employers  of  labor,  the  risks  being  classi- 
fied according  to  hazard,  the  invalidity  premiums  varying  in  the 
different  classes. 

One  or  two  companies  are  offering  mortgage  loans  on  homes, 
with  provision  for  amortization  protected  by  life  insurance — a 
form  of  service  of  the  greatest  benefit  to  the  community  as  well 
as  to  the  insured. 

The  latest  development  of  life  insurance  in  this  country  is  in- 
teresting and,  to  those  who  know  the  history  of  this  business,  really 
amazing.  It  is  distinctively  American,  for  it  is  seen  in  no  other 
country.  It  is  doubtless  the  outgrowth  of  the  sentiment  which 
of  late  years  is  pervading  society  throughout  the  world,  and  in 
this  countiy  especially  has  involved  industrial  and  commercial 
business ;  the  sentiment  that  there  is  a  responsibility  resting  upon 
the  prosperous  to  help  the  less  fortunate;  that  there  is  a  duty 
to  the  community  to  better  conditions  and  uplift  the  mass.  As 
life  insurance  is  based  upon  mortality,  it  is  a  logical  working  out 


WORLD'S  INSURANCE  CONGRESS  113 

of  this  sentiment  for  the  insurance  companies  to  do  something 
to  lower  the  death-date — to  conserve  health  and  lengthen  human 
life.  It  is  the  same  sentiment  which  leads  manufacturers  to  im- 
prove conditions  of  labor  and  domestic  life  of  wage-earners  and 
to  promote  thrift. 

The  new  service  which  life  insurance  has  begun  runs  along  sev- 
eral channels,  and  we  may  well  take  a  brief  survey.  In  a  paper 
widely  distributed  at  the  Fifteenth  International  Congress  on  Hy- 
giene and  Demography  held  three  years  ago,  Mr.  Cox,  manager 
of  the  Presidents'  Association,  composed  of  about  thirty  life  insur- 
ance companies  carrying  seventy-seven  per  cent,  of  the  American 
policies,  noted  that  there  was  a  group  of  five  companies,  with 
twenty-two  millions  of  policies,  that  were  making  special  efforts 
to  stimulate  their  policyholders  to  personal  and  public  hygiene; 
that  there  was  another  group  of  four  companies  which  advised  im- 
paired applicants  for  insurance  as  to  their  physical  condition  and 
made  suggestions  to  aid  them.  Another  company  provided  for 
free  periodical  medical  examinations  of  its  policyholders.  An- 
other had  formed  a  health  association  among  its  members.  The 
Presidents'  Association  itself  opened  a  forum  a  few  years  ago  for 
the  discussion  of  things  intended  to  prevent  disease ;  and  papers 
were  read  by  Professor  Fisher  of  Yale,  Dr.  Foster  of  the  St.  Paul 
Medical  Journal,  Dr.  Wyman,  Surgeon-General  of  the  United 
States  Health  and  Hospital  Service,  Dr.  Rosenau  of  the  Harvard 
Medical  College,  Dr.  Foster,  Health  Commissioner  of  New  York 
State,  Dr.  Doty,  Health  Officer  of  New  York  City,  Dr.  Wilbur  of 
the  Census  Bureau,  and  Dr.  Dwight  of  the  New  England  Mutual 
Company,  on  such  subjects  as  the  "Economic  Aspect  of  Lengthen- 
ing Human  Life,"  "Increased  Longevity  of  Policyholders," 
"Work  of  the  Federal  Government  in  Health  Conservation," 
"Preventive  Medicine,"  "Fight  against  Preventable  Diseases," 
"Modem  Sanitation,"  etc.  The  American  Life  Convention  had 
addresses  by  experts  on  "Forces  Against  Mortality,"  "Mortality 
from  Diseases  of  the  Kidneys  and  Circulatory  System,"  "The 
Short  Life  History." 

A  Life  Extension  Bureau  has  been  formed,  patronized  by  several 
companies,  which  examines  insured  persons  and  communicates  the 
results  to  the  family  physicians,  the  cost  defrayed  by  the  com- 
panies. One  life  insurance  company  has  thus  had  examined  eight 
thousand  of  its  policyholders. 

One  company  with  nearly  thirteen  millions  of  policies  in  force 
has  issued  large  numbers  of  pamphlets  and  leaflets  on  health  and 
disease  to  its  policyholders  and  has  an  expert  constantly  studying 
morbidity  from  many  points  of  view,  especially  occupational  dis- 
eases, and  publishes  the  results. 

Another  company,  with  nearly  fifteen  millions  of  policies,  has 
an  elaborate  system  of  education  and  of  fighting  disease  arid 
ameliorating  sickness.  It  has  circulated  over  thirty  millions  of 
pamphlets  in  several  languages  upon  such  subjects  as  "Tubercu- 


114       WORLD'S  INSURANCE  CONGRESS 

losis"  (six  millions),  "Care  of  Children"  (two  and  a  half  mil- 
lions), "Teeth,  Tonsils  and  Adenoids"  (same  nimiber),  "Health 
of  the  Worker,  Care  of  Babies"  (five  millions),  "Milk"  (five  mil- 
lions), "Flies  and  Filth"  (five  millions),  "Smallpox,  Typhoid 
Fever,  Scarlet  Fever,"  and  has  distributed  thirty- four  millions  of 
paper  drinking-eups.  It  exhibits  health  educational  booths  at 
county  fairs,  as  many  as  125  in  a  year.  It  assists  health  officers 
in  clean-up  campaigns  in  over  150  cities.  It  has  helped  the  au- 
thorities to  enforce  housing  laws,  distributed  ballots  on  votes  for 
municipal  sanatoria,  cooperated  with  anti-tuberculosis  societies, 
agitated  in  legislature  and  among  health  officers  for  systematic  and 
accurate  vital  statistics.  Its  most  remarkable  work  on  lines  of 
health  is  a  system  of  furnishing  free  the  service  of  trained  nurses 
among  sick  policyholders,  whose  visits  number  a  million  a  year; 
the  nurses  attend  the  sick  and  give  instruction  to  the  families  in 
hygiene.  The  company  has  built  a  sanatorium  for  tuberculous 
employees  and  is  building  a  rest  house  for  convalescents  from 
other  diseases.  The  sanatorium  is  a  center  of  study  of  the  White 
Plague,  its  prevention  and  cure,  and  caiTies  on  correspondence 
and  reciprocal  visits  with  like  institutions.  Of  the  number  treated, 
including  those  still  in  the  institution,  it  has  discharged  as  cured 
(or  "arrested  cases,"  as  physicians  say)  25  per  cent,  in  two  years' 
work,  although  over  8  per  cent  of  the  cases  sent  were  far  ad- 
vanced, 61  per  cent,  moderately  advanced,  and  many  are  still 
under  treatment.  Altogether  the  company  spends  more  than  a 
million  dollars  a  year  in  welfare  work.  The  company  medically 
examines  its  seventeen  thousand  agents  and  employees  annually 
for  the  discovery  and  treatment  of  incipient  disease. 

The  service  which  life  insurance  performs  to  its  patrons — out- 
side of  its  function  of  paying  death  claims— and  to  the  commu- 
nity generally  is  no  doubt  in  its  infancy.  The  pioneers  expect  and 
hope  for  followers.  The  lines  of  its  services  may  take  new  direc- 
tions and  go  to  further  lengths.  The  business  of  life  insurance 
is  expanding  wonderfully.  The  ambition  of  its  managers  is  to 
furnish  protection  to  all  of  the  healthy  population,  and  many  of 
those,  who,  though  impaired,  are  insurable  as  sub-standard  risks. 
If  one  in  five  is  now  insured,  why  not  four  in  five!  Looking  at 
the  past  growth  of  the  business,  is  there  any  limit  to  its  increase ! 
Why  not  look  to  the  time  when  the  people  shall  perform  ser^'ice  to 
themselves,  through  the  instrumentality  of  life  insurance,  a  serv- 
ice covering  health  in  life,  care  in  sickness,  indemnity  in  death, 
sanitation  in  community  life,  the  financing  of  home-owning,  of 
public  utilities  and  civic  conveniences— a  service  resulting  from 
such  wide-spread  cooperation  that  it  may  be  called  a  New  Social- 
ism ! 

For  it  is  instructive  to  note  that  of  the  forty  millions  of  policies 
now  extant,  nearly  thirty-five  millions  are  in  mutual  companies. 


WORLD'S  INSURANCE  CONGRESS  115 

SERVICE   PERFORMED   BY  LIFE   INSURANCE 
COMPANIES 

By  T.  L.  Miller 
President,   West   Coast-San   Francisco   Life   Insurance   Company 

Environment  and  association,  temperment  and  sectional  needs 
are  among  the  elements  that  influence  and  determine  the  view- 
point from  which  we  unconsciously  first  consider  a  given  subject, 
hence  the  wide  divergence  of  individual  treatment.  It  is  indeed 
a  wise  and  discerning  Director  General  who  from  the  results  can 
recognize  the  topic  which  his  brain  fathered. 

Not  only  is  this  condition  natural,  because  the  man  whose  life 
work  and  personal  experience  has  run  along  lines  of  order,  prece- 
dent and  convention  can  see  nothing  but  anarchy  or  rather  heresy 
in  the  views  of  the  pioneer  by  temperament  and  practice,  but  it 
is  valuable  for  the  reason  that  in  a  happy  medium  between  ex- 
tremes lies  the  channel  through  whose  sinuous  windings  the  Life 
Insurance  craft  must  work  its  course. 

To  me,  a  pioneer  by  birthright,  temperament  and  by  practice, 
the  afternoon's  topic  means  not  so  much  future  as  past  service — 
service  not  alone  to  policyholders  but  to  geographical  divisions  of 
this  country,  to  communities  and  individuals  and  interests  alike. 
It  means  not  so  much  the  service  rendered  the  cause  of  Life  Insur- 
ance by  the  scout  or  the  torpedo  boat,  or  in  other  words,  to  me  the 
topic  really  is :  "  What  part  have  the  younger  companies  assumed, 
and  in  the  future  will  assume,  in  rendering  that  service  upon  which 
all  business  to-day  is  predicted?" 

For  a  moment  put  yourselves  in  the  place  of  the  Executive  of 
a  new  company,  the  offspring  of  local  pride  and  Home  Industry 
feeling — the  first-born  of  men  and  interests  that  perhaps  are  still 
under  the  glamor  of  an  hypnotic  prospectus,  and  who  asks  himself 
this  question :  "To  what  use,  and  in  what  way  are  the  forces  avail- 
able to  be  used  to  the  best  advantage?" 

Systematic,  conscientious,  thoughtful  study  shows  his  competi- 
tors intrenched — great  in  size,  in  reputation,  in  demonstrated  re- 
sults— and  with  men  who  would  be  of  the  greatest  value  to  him  as 
teachers  and  trainers  of  others  tied  hand  and  foot  by  renewal 
equities. 

Probably  all  we  pioneers  travel  the  same  trail  of  thought,  along 
the  same  cliffs  where  a  misstep  means  oblivion,  and  from  the  almost 
universal  adoption  of  the  same  policy  reach  the  same  general  rest- 
ing place — the  offsetting  of  ingenuity,  of  new  and  attractive  ways 
of  presenting  our  wares  against  the  conventional,  innovation  and 
betterments  against  money  and  age,  liberalization  against  prece- 
dent— in  a  word,  the  substitution  of  the  motto,  ' '  Because  it  is  now, 


116       WORLD'S  INSURANCE  CONGRESS 

per  se,  it  is  not  wTong!"  for  the  motto  "My  dear  fellow,  really, 
it  isn't  done!" 

To  the  fact  that  the  pioneer  must  lay  and  clear  his  own  trails 
is  due  the  easier  grades  and  smoother  roads  the  insuring  puhlic  is 
following  to-day. 

To  the  needs  of  the  young  company  is  due,  after  years  of  critic- 
ism and  argument  and  effort,  the  recognition  by  authorities  of  the 
soundness  and  justice  of  the  preliminary  term  method  of  valuation 
and  the  incorporation  in  some  form  or  other  of  this  recognition  in 
the  statutes  of  most  of  our  States.  On  this  stone,  in  large  part, 
is  builded  all  the  rest,  because  it  is  the  principle  that  the  new 
business  written  each  year  should  pay  the  cost  of  procuring  the 
same,  that  makes  the  new  company  possible. 

To  competitive  conditions  that  could  in  no  other  way  be  met 
and  overcome  is  due  in  major  part  the  progress  and  advancement 
in  the  simplification  and  liberalization  of  policy  contracts,  of  which 
the  insuring  public  gathers  the  benefits.  I  say  in  "major  part" 
because,  while  it  is  true  that  the  growth  of  public  sentiment  to- 
wards a  higher  standard  of  responsibility  in  the  relations  between 
the  public  and  corporate  interests  has  exercised  no  little  influ- 
ence, it  was  stronger  and  more  quickly  effective  by  pointing  out  a 
business  opportunity  to  be  grasped  than  as  a  moral  requirement  to 
be  met. 

Place  side  by  side  life  insurance  policies  in  vogue  during  the 
last  ten  years  of  the  last  century  with  those  of  the  first  decade  in 
this ;  compare  their  clarity  and  simplicity ;  their  reTative  non- 
forfeiture methods  and  values;  their  dividend  privileges;  weigh 
the  total  disability  provisions  and  the  accident  and  health  features 
of  the  one  with  the  restrictive  provisions  of  the  other.  Are  further 
arguments  as  to  the  facts  needed  ?  No  !  yet  probably  to  your  minds 
may  come  the  question:  "Wliy  should  one  assume  that  such  work 
was  initiated  by  the  young  rather  than  the  old,  since  both  partici- 
pated?" The  answer  is  as  simple  as  the  facts  and  opportunities 
were  plain. 

Mobility  and  closer  touch  were  the  determining  factors,  because 
the  Executive  of  the  vigorous,  aggressive,  young  organization,  with 
his  mind  and  time  more  largely  free  from  the  demands  of  volume 
and  age  and  policy,  and  with  the  incentive  to  production  removed 
from  the  larger  company  by  legally  restricted,  annual,  new-busi- 
ness limits,  was  in  more  intimate  personal  touch  with  insurers  and 
his  business,  dealing  with  conditions  aaid  needs  as  individual,  sepa- 
rate cases,  rather  than  by  classes  and  pre-established  rules,  and 
more  nearly  acquired  the  standards  of  the  general  public,  saw  with 
its  eyes  and  thought  its  thoughts.  Popular  tendencies  of  thought 
and  action  offered  to  him  not  academic  consideration  and  discus- 
sion but  business— dollars  and  cents— opportunities  to  be  grasped, 
and  used  in  advancing  on  his  "dug  in"  competitors. 
""Side  by  side  with   the  improvement  in  the  contraetural  rela- 


WORLD'S  INSURANCE  CONGRESS  117 

tions  between  Public  and  Company  ran  equal  liberalization  and 
benefits  along  economic  and  financial  lines. 

Again,  the  Executive  of  the  j^oung  ambitious,  growing  com- 
pany, with  his  ear  close  to  the  ground,  heard  the  murmurings  and 
whispers  of  an  awakening  public,  grasped  their  meaning,  which* 
perhaps  the  public  itself  had  not  yet  fully  realized,  and  the  longed- 
for  opportunity  it  offered,  and  responded. 

Once  more  he  began  to  offset  one  advantage  against  another — to 
make  strength  out  of  weakness — to  supply  an  insistent  and  increas- 
ing need  by  preaching  the  doctrine :  ' '  Keep  your  money  at 
home." 

In  the  younger,  more  scattered  and  ambitiously  striving  commu- 
nities, the  appeal  was  to  waiting  and  receptive  ears;  the  response 
equally  prompt.  In  the  West,  especially,  where  communal  de- 
velopment waited  only  on  financial  ability,  the  doctrine  became 
almost  a  sacred  one.  Tabulation  of  premium  payments  to  com- 
panies of  other  States  took  the  place  of  other  business,  getting 
reasons  why,  with  the  result  that  such  companies,  foreign  to  these 
Western  States,  awakening  to  possibilities  imminent  and  in  some 
cases  in  spite  of  State  Laws,  difficult  of  accomplishment,  re- 
organized their  methods.  Local  industries  began  to  benefit  from 
broader  financial  opportunities.  Not  only  were  the  modest  ac- 
cumulations of  young,  local  companies,  in  good  faith,  applied  to 
the  development  of  home  institutions  and  industries,  but  these 
larger  holders  of  insurance  accumulations,  again  under  competitive 
influences,  loosened  their  purse  strings,  and  once  more  did  entire 
geographical  divisions,  to  say  nothing  of  smaller  communities,  owe 
their  broader  benefits  to  the  service  performed  by  the  young  Life 
Insurance  Company. 

Continuing  the  consideration  of  services  of  the  past,  and  in  the 
future  to  be  performed,  we  come  to  certain  psychological  and 
broad  general  services  which  again  it  has  fallen  to  the  lot  of  the 
young  companies  to  perform. 

With  those  of  you  who  in  the  past,  from  the  very  nature  of 
things,  have  found  it  impossible  to  have  your  fingers  closely  upon 
the  public  pulse,  the  assertion  may  come  as  a  shock  or  as  an  un- 
founded absurdity  when  you  listen  to  the  statement  that  the  or- 
ganization of  the  young  companies  more  than  any  other  influence 
divested  the  public  mind  from  a  slowly  chrystalizing  belief  that 
if  ever  there  was  a  so-called  "trust"  the  concentration  of  this 
business  of  ours  in  the  hands  of  a  few  companies  had  that  semb- 
lance, and  I  am  not  alone  among  those  who  studied  the  uncon- 
scious and  perhaps  unformed  thought  tendency  of  the  public 
mind  towards  communal.  State  or  National  protective  measures 
and  insurance  carriers  to  recognize  this.  The  coming  of  the 
local  company  did  most  to  undo  the  growing  disfavor  and  sus- 
picion with  which  the  gathering  of  funds  from  the  many  sources 
for  investment  in  a  favored  centre  was  viewed,  and  since  its  advent 
has  brought  about  the  hoped  for  results,  let  this  service,  too,  be 


118  WORLD'S  INSURANCE  CONGRESS 

credited,  as  one  already  rendered  and  one  to  be  rendered  in  the 
future. 

Since  in  numbers  there  is  power,  and  since  almost  every  State 
and  Territory  in  those  re-United  States  of  ours  domiciles  one  or 
more  local  company,  their  united  influence,  exercised  through  the 
close  association  which  exisits  among  them,  has  been  towards  na- 
tional education  and  uniform,  sane  legislation.  Its  widely  scat- 
tered ranks  have  proven  a  constant  and  efficient  line  of  pickets, 
watching  carefully  and  closely  proposed  legislation,  initiating  only 
such  laws  as  were  essential  to  the  welfare  of  policyholders,  op- 
posing such  as  were  "class"  or  biased,  they  have  stood  for  good 
laws  and  uniformity  of  enactment  and  method. 

The  general  public,  by  reason  of  this  same  wide  distribution  of 
its  local  companies,  with  their  many  thousands  of  interested  stock- 
holders and  agency  representatives,  has  been  educated  to  clearer 
and  more  correct  views  of  life  insurance,  and  has  been  brought  into 
closer  touch  not  only  with  the  great  principles  underlying  the 
business  but  to  a  nicer  discrimination  of  its  practical  application 
and  of  the  broadening  methods  of  the  companies  throughout  the 
Union.  To  this  unobstrusive,  though  never-ending  education 
largely  is  due  the  growing  popular  appreciation  of  life  insurance 
as  an  economic,  social  and  educational  factor  of  inestimable  value. 

To  the  mind  of  the  temperamental  Pioneer,  therefore,  comes  the 
conviction  that  to  the  competitive  influence  of  the  young  compa- 
nies, subtly  and  conscientiousl.y  working  to  the  end  of  attainment, 
ever  sleeplessly  alert  for  opportunities  to  advance,  possibly  their 
selfish  interests,  but  nevertheless  manfully  to  measure  up  to  the 
responsibilities,  moral  and  financial,  resting  upon  them,  may  di- 
rectly be  credited  these  services — to  the  business,  the  policyhold- 
ers and  the  world : 

1.  (a)   Simplicity  and  clarity  of  contract. 

(b)  Liberalization  and  broadening  the  scope  of  protection  un- 
der one  policy. 

(c)  Flexibility  in  meeting  contract  conditions,  and  local  finan- 
cial needs. 

2.  (a)  Picketing  the  danger  line  of  thoughtless  or  selfish  or  haz- 

ardous or  "freak"  legislation. 
(b)  Calmly  and  in  full  appreciation  of  approaching  and  chang- 
ing economic  conditions,  initiating  only  such  movements 
as  were  for  the  general  good  of  the  policyholder  and  the 
community,  and  standing  like  another  "Stonewall"  against 
the  advance  of  anything  else. 

3.  Directly    and    through    their    example,    blazing   for    others   to 

follow  the  investment  trail  to  far  lands  and  sections  wait- 
ing only  this  help  to  spring  into  world  usefulness. 


WORLD'S  INSURANCE  CONGRESS  119 

4.  (a)  By  their  being  and  activity  and  the  hope  and  confidence 

granted  to  them  at  home,  they  did  more  than  any  one  other 
element  to  divert  the  ''Trust"  idea  growing  up  throughout 
the  land, 
(b)  To  delay,  if  not  entirely  to  divert  from  the  people  and  the 
business.  State  or  National  insurance  with  all  the  uncer- 
tainties and  possibilities  of  such  a  movement. 

5.  Their     intimate     personal     association     and    touch     with    the 

people,  applied  homeopathically,  if  you  will,  but  direct  to 
the  patient,  not  in  a  few  communities,  but  all  over  this 
broad  land  of  ours,  wherever  is  domiciled  one  of  the  two 
hundred  or  more  young,  local  companies,  has  tended  to- 
wards a  fuller  appreciation  of  life  insurance  as  a  com- 
munal as  well  as  an  individual  factor  than  before  existed. 

Upon  the  services  of  the  past,  I  have  commented,  superficially, 
touching  only  upon  a  few  among  many. 

Of  the  future,  it  may  with  certainty  be  said,  they  will  be  like 
unto  the  past.  To  claim  otherwise  is  to  assert  that  all  the  con- 
scientious effort  to  measure  up  to  responsibility,  that  all  the  in- 
surance ingenuity  and  brains,  will  pass  with  this  generation, 
because  as  the  Pioneers  of  to-day  gain  in  age  and  size  and  impor- 
tance and  with  these  conditions,  acquire  greater  love  and  respect 
for  the  "flesh  pots  of  Egypt,"  a  new  generation,  equally  virile 
and  ambitious,  will  be  facing  their  problems,  exercising  their  in- 
genuity, rendering  their  services  to  the  cause,  because,  unpopular 
as  its  recognition  sometimes  is,  "Youth  must  be  served." 


SERVICE   PERFORMED  BY  CASUALTY  AND  LIABILITY 

COMPANIES 

By  David  Van  Schaack 

Director,  Bureau  of  Inspection  and  Accident  Prevention,  Aetna 
Life  Insurance  Company 

Mr.  Chairman  and  Gentlemen :  It  is  very  gratifying  to  me  to 
have  this  opportunity  of  addressing  you  to-day — gratifying  to  me 
personally  because  I  can  properly  devote  the  greater  part  of  my 
time  to  a  branch  of  my  subject  in  which  I  have  long  taken  the 
keenest  interest,  gratifying  in  a  larger  sense  because  the  selection 
of  the  subject  as  a  whole  gives  convincing  evidence  of  how  the 
full  range  of  insurance  as  a  social  force  has  now  come  to  be  ap- 
preciated. 

The  economic  function  of  insurance,  the  fundamental  idea  which 
was  originally  its  basis  and  which  remains  so,  has  long  been  clearly 
understood.     A  proper  distribution  of  financial  risks  is  of  neces- 


120       WORLD'S  INSURANCE  CONGRESS 

sity  the  very  basis  of  all  insurance.  To  a  realization  of  the  need 
for  such  distribution  the  idea  of  insurance  owes  its  origin.  If  it 
were  not  for  the  feeling  on  the  part  of  society  at  large  tliat  calam- 
ity in  general — whether  due  to  the  elements,  to  the  immutable  laws 
of  life,  to  the  hazards  of  existence,  or  to  the  frailties  of  mankind — 
can  best  be  cared  for  by  dividing  the  cost  of  each  calamity  in  par- 
ticular among  as  large  a  number  as  possible  of  the  members  of 
society,  so  that  it  will  not  fall  with  crushing  effect  upon  one,  there 
would  be  no  sufficient  reason  for  the  existence  of  the  great  business 
of  insurance  in  all  its  many  ramifications. 

This  feeling,  originally  entertained  nearlj^  three  thousand  years 
ago  in  connection  with  the  manifest  perils  of  traffic  by  sea,  has 
spread  by  degrees,  and  of  late  with  astonishing  rapidity,  until  now 
it  is  applied  to  everj^  imaginable  possibility,  and  even  to  some  pos- 
sibilities which  give  the  imagination  a  rather  severe  strain. 

It  would  seem  that  this  distribution  of  the  cost  of  calamity  would 
of  itself  fully  justify  the  existence  of  insurance  as  an  essential 
factor  in  society's  w^ell-being.  And  undoubtedly  it  would  be  so 
considered  were  it  not  for  the  broader  and  better  view  of  the  func- 
tions of  insurance  which  has  gradually  come  to  be  entertained  and 
which  is  now  increasing  so  rapidly  in  its  application. 

It  is  especially  gratifying  to  insurance  men  to  feel,  and  be  justi- 
fied in  feeling,  that  this  broader  and  better  view  owes  its  origin 
in  large  part,  if  not  wholly,  to  insurance  itself  and  not  to  the 
constraining  influence  of  any  outside  impulse,  legislative  or  that 
of  more  informal  public  opinion.  The  idea  of  social  service  as  a 
function  of  insurance,  that  "social  service  which  goes  beyond  in- 
demnification for  loss  and  all  which  that  accomplishes,  both  di- 
rectly and  indirectly,  is  a  natural  outgrowth  of  indemnification, 
or,  more  accurately,  of  the  underwriting  which  makes  indemnifica- 
tion possible. 

This  statement  should  not  bo  taken  as  belittling  the  social 
service  which  is  a  direct  and  inevitable  result  of  indemnification, 
and  which  is  so  manifestly  of  prime  importance.  It  is  a  popular 
fallacy  that  the  greatest  social  service  in  this  respect  is  performed 
by  fire  insurance,  but  careful  consideration  of  the  facts,  so  far  as 
they  are  scientifically  available,  would  tend  to  show  that  casualty 
insurance  has  a  larger  function  to  exercise  in  even  this  field.  Tlie 
loss  of  time  occasioned  by  accident  and  illness  is  greater  than  the 
property  loss  occasioned  by  fire,  large  as  that  regrettably  is. 

So  far  as  the  beneficial  possibilities  inherent  in  indemnification 
for  loss  are  concerned,  casualty  insurance  need  yield  to  neither  fire 
nor  life  in  its  power  for  good,  that  power  which  not  only  indemni- 
fies the  individual  for  his  personal  loss,  but  which  tends  to  pre- 
vent his  inability,  temporary  or  otherwise,  to  contribute  his  share 
toward  the  creation  of  wealth,  with  all  its  attendant  benefits,  from 
becoming  a  direct  drain  upon  society. 

It  would  be  superfluous,  before  an  audience  of  this  character, 
for  me  to  go  further  and  dwell  in  detail  upon  the  positive  side  of 


WORLD'S  INSURANCE  CONGRESS  121 

this  apparently  negative  service  performed  by  casualty  insur- 
ance— how  it  aids  the  injured  or  sick  man  to  return  to  his  field 
of  activity,  how  it  continues  to  such  a  man 's  family  the  opportuni- 
ties for  advancement  and  improvement  which  otherwise  they  would 
so  often  he  apt  to  lose. 

There  is  a  social  service  of  even  deeper  significance  to  which  I 
think  attention  should  be  especially  directed,  and  it  is  that  which 
I  had  chiefly  in  mind  when  I  said  that  the  idea  of  social  service 
as  rendered  by  insurance  is  a  natural  outgrowth  of  insurance  un- 
derwriting. This  particular  service  is  evidenced  by  the  capacity 
of  insurance  companies,  and  I  think  I  may  fairly  say  especially 
casualty  companies  engaged  in  liability  and  Workmen's  Compen- 
sation business,  to  act  as  agencies  of  conservation. 

It  has  been  a  somewhat  prevalent  custom,  in  some  quarters  at 
least,  to  consider  insurance  as  peculiar  among  businesses,  but, 
strictly  speaking,  no  sound  basis  can  be  found  for  such  a  view. 
Insurance  may,  and  does,  enjoy  greater  opportunities  generally 
for  rendering  social  service  than  are  possible  to  other  businesses, 
and  it  cannot  but  be  gratifying  to  insurance  men  to  know  that  such 
possibilities  exist,  but  the  realization  of  these  opportunities  can, 
and  does,  proceed  only  from  the  proper  conduct  of  insurance  as  a 
business. 

Combined  business  and  profession  as  it  is,  insurance  is  just  like 
any  other  business.  To  justify  its  existence,  its  operations  must  be 
so  conducted  that  a  reasonable  profit  shall  accrue,  and  at  the  same 
time  its  product  shall  be  available  to  the  consumer  of  it  at  the 
lowest  price  consistent  with  its  quality.  It  is  this  very  principle 
of  all  business  that  is  making  insurance  one  of  the  greatest  factors 
in  conservation  that  the  world  has  ever  known.  To  put  it  plainly, 
conservation  is  good  business.  It  conduces  to  economy  of  produc- 
tion, in  insurance  as  in  any  other  phase  of  industry.  Economy  in 
the  making  of  insurance  is  just  as  essential  to  insurance  holding 
its  own  as  it  is  in  the  case  of  any  other  product.  No  matter  what 
a  product  may  be,  insurance  or  anything  else,  the  consumer  will 
not  use  it  and  continue  to  use  it  unless  it  is  produced  as  economi- 
cally as  good  quality  will  permit.  Products  are  just  as  subject 
as  men  to  the  law  of  the  survival  of  the  fittest. 

It  is  only  natural,  then,  that  insurance  companies  should  have 
turned  their  serious  attention  to  the  effort  toward  conservation, 
toward  elimination  of  unnecessary  waste,  whether  of  life,  or  limb, 
or  property,  or  what  not,  which  is  already  making  them  such  vital 
factors  in  some  of  the  most  important  fields  of  real  social  service, 
and  which  cannot  fail  inevitably  to  lead  to  a  wider  sphere  of  use- 
fulness for  them,  both  directly  and  indirectly. 

The  ways  in  which  this  social  service  is  being  rendered  are  so 
manifold  that  the  subject  in  general  is  very  properly  receiving  an 
entire  day's  attention  at  this  World's  Insurance  Congress,  and, 
most  fittingly,  thus  early  in  its  sessions.  They  are  also  so  inter- 
related  that   it   is   difficult   in   many   instances   to   segregate   the 


122       WORLD'S  INSURANCE  CONGRESS 

service  rendered  by  one  class  of  insurance  from  that  rendered  by 
others. 

I  doubt,  however,  if  any  branch  of  this  service  is  more  significant 
at  this  time,  or  more  pregnant  with  future  possibilities,  than  that 
one  feature  of  the  service  rendered  by  casualty  and  liability  com- 
panies upon  which,  with  your  permission,  I  should  like  particularly 
to  dwell,  namely,  their  accident  prevention  work. 

When  we  consider  the  vast  army  of  industrial  workers  in  this 
country,  the  importance  to  social  betterment  generally  of  an 
earnest,  systematic  and  scientific  effort  to  reduce  to  the  minimum 
the  accidents  which  hitherto  have  been  considered  inseparable  from 
industrial  life  can  readily  be  appreciated. 

Ever  since  Employers'  Liability  insurance  began  to  be  gener- 
ally written  in  this  country  casualty  companies  have  been  fully 
cognizant  of  the  great  waste  caused  by  industrial  accidents,  a 
waste  which  not  only  reflected  itself  in  a  disproportionate  loss 
ration  to  the  companies,  but  was  a  tremendous  drain  upon  the 
greatest  asset  of  any  nation,  the  brains  and  brav/n  of  its  people. 
Insurance  men  recognized  clearl}'  that  this  waste  in  considerable 
part  was  unnecessary,  under  proper  working  conditions  was  avoid- 
able. They  saw  the  importance  to  workers,  to  employers,  and  to 
society,  as  well  as  to  themselves,  of  preventing  this  avoidable  waste, 
so  far  as  might  be  possible,  but  they  could  not  make  others  see  it 
as  they  did. 

Actuated,  to  speak  frankly,  by  the  purely  selfish  desire  to  main- 
tain and  extend  their  business  through  offering  liability  insurance 
at  a  price  which  employers  would  be  willing  to  pay,  and,  through 
keeping  losses  within  reasonable  limits,  to  derive  from  this  busi- 
ness the  fair  profit  which  any  business  should  afford,  several  of 
the  more  far-seeing  companies  maintained  from  the  very  time  of 
their  entrance  into  the  liability  insurance  field  expert  inspection 
departments,  through  the  agency  of  which  the  causes  of  prevent- 
able accidents  were  brought  to  the  attention  of  employers  and  the 
means  of  eliminating  these  causes  urged.  But  under  the  Em- 
ployers' Liability  laws  results  were  discouragingly  slow  in  accom- 
plishment. 

This  was  due  partly  to  the  apathy  of  many  employers  as  re- 
garded accident  prevention,  partly  to  the  short-sighted  policy  of 
some  insurance  companies  in  eagerly  striving  for  business  at  any 
price,  but  chiefly  perhaps  to  the  fact  that  the  widely  varying  pay- 
ments which  had  to  be  made,  under  Employers'  Liability  laws, 
for  the  same  kinds  of  injuries  made  it  impossible  for  insurance  to 
be  placed  upon  that  definite  basis  which  would  enable  it  to  offer 
employers  sufficiently  tangible  inducements  to  accident  prevention 
activity. 

The  wave  of  Workmen's  Compensation  legislation  which  has 
been  sweeping  over  this  country  during  the  past  few  years,  how- 
ever, marks  the  beginning  of  a  new  era  in  insurance  relating  to 
industrial  accidents.    The  fixing  of  compensation  by  such  laws,  so 


WORLD'S  INSURANCE  CONGRESS  123 

far  as  compensation  can  be  fixed  in  advance,  and  the  certaint}^  that 
payments  of  compensation  will  go  where  they  belong,  wholly  to 
injured  workmen  or  their  dependents,  in  no  part  to  parasites, 
offer  insurance  companies  an  opportunity  to  give  due  credit  not 
only  to  the  employer  who  has  not  had  as  many  accidents  as  others 
in  his  line  of  work,  but  to  him  who  takes  precautions  in  advance 
to  keep  from  having  accidents. 

It  is  in  availing  themselves  of  this  opportunity  to  the  full  extent 
possible  that  casualty  insurance  companies  are  rendering  what  I 
believe  may  fairly  be  termed  the  greatest  social  service  yet  per- 
formed by  insurance  in  any  of  its  many  fields  of  activity. 

The  influence  which  the  merit  system  of  rating  compensation 
risks,  a  system  originated  by  the  company  with  which  I  have  the 
honor  to  be  connected,  and  now  generally  used,  is  exercising  in 
promoting  the  cause  of  accident  prevention  cannot  fail  to  be  at 
least  as  potent  and  far-reaching  as  any  other,  and  I  believe  will  be 
more  so  than  any  other.  Rating  a  risk  according  to  its  individual 
merits  as  regards  accident  prevention  provisions,  physical  and 
otherwise,  touches  that  most  sensitive  spot,  the  pocket-book,  and 
it  does  far  more  than  this.  It  points  out  dangerous  places  and 
conditions  which  long  familiarity  or  lack  of  knowledge  have  tended 
to  obscure,  and  thus  leads  to  the  remedying  of  them. 

It  is  not  disparagement  of  the  work  in  stimulating  accident  pre- 
vention interest  and  activities  done  by  humanitarian  individuals 
or  societies,  by  single  employers  or  associations  of  employers,  or 
by  State  authorities,  to  emphasize  the  indisputable  fact  that  insur- 
ance companies  come  into  direct  touch  with  many  more  employers 
than  any  one  other  agency  or  group  of  agencies,  perhaps  than  all 
others  together,  and  therefore  have  the  greatest  opportunity  of 
forwarding  accident  prevention,  and  thereby  rendering  a  real  so- 
cial service  of  far-reaching  range. 

How  far-reaching  this  range  is  can  best  be  appreciated  by  con- 
sidering what  industrial  accidents  mean  and  what  their  preven- 
tion effects,  both  from  the  moral,  the  humanitarian  standpoint  and 
from  the  economic  one. 

Viewed  from  the  economic  side,  whether  broadly  or  narrowly, 
the  value  of  accident  prevention  is  unmistakable,  to  employees, 
to  employers  and  to  society  at  large.  The  cost  of  accidents  is  not 
measurable  in  terms  of  the  money  paid  out  in  compensation  or 
damages.  Great  as  this  is  in  the  aggregate,  it  is  only  a  part  of  the 
drain  upon  created  wealth  which  results  from  accidents,  I  might 
say  but  a  small  part. 

"When  a  workman  is  thus  withdrawn  from  the  wage-earning 
class,  there  are,  sooner  or  later,  many  other  calls  upon  accumu- 
lated funds.  The  economic  balance  in  the  workman's  home  is  dis- 
turbed. There  is  medical  expense,  possibly  the  cost  of  hospital 
care,  possibly,  too,  the  expense  of  litigation.  The  injured  man  may 
have  to  be  supported  in  his  old  age.  It  may  be  necessary^  to  care 
for  dependents,  even  beyond  what  compensation  or  damages  may 


124       WORLD'S  INSURANCE  CONGRESS 

do.  In  one  way  or  another  there  is  sure  to  be  a  demand  that  the 
loss  caused  by  the  worker 's  inability  to  continue  doing  his  full  part 
in  the  world's  work  be  made  up.  It  is  immaterial  how  this  demand 
is  met,  whether  by  the  worker's  own  savings,  by  mutual  benefit 
associations,  by  insurance,  by  public  or  private  charity,  by  taxa- 
tion, there  is  economic  waste. 

This  economic  waste  is  evident,  too,  in  another  way,  which  comes 
closer  home  to  the  employer,  and  through  him  to  the  consumer,  so- 
ciety, but  which  also  affects  the  workman.  This  is  in  the  dimin- 
ished efficiency  of  the  plant.  An  accident  distracts  other  workers 
in  the  vicinity,  stopping  their  productivity  for  the  moment  and 
curtailing  it  for  some  time.  Productiveness  is  also  diminished 
while  the  place  of  a  man  temporarily  disabled  is  held  open  for 
him,  or  a  new  man  is  being  trained  to  take  the  place  of  one  per- 
manently disabled.  It  costs  money  to  train  a  new  man  for  a  job, 
and  to  pay  for  the  defective  work  he  turns  out  and  the  scrap  loss 
he  causes.  This  cost  must  be  first  met  by  the  employer,  but  even- 
tually society  and  the  employee  must  bear  their  full  share.  Any 
drain  upon  the  employer  has  a  direct  bearing  upon  them. 

Most  important  of  all  considerations  on  the  economic  side  is  the 
part  which  accident  prevention  plays  in  conserving  that  greatest 
asset  of  any  nation,  its  people.  If  we  should  conserve  our  forests 
and  our  water  power,  how  much  more  essential  that  w^e  should 
conserve  the  productive  power  of  the  community,  both  present  and 
future.  I  use  the  words  present  and  future  advisedly,  for  indus- 
trial accidents  not  only  destroy  or  curtail  the  working  power  of 
the  injured  men  themselves,  but  through  putting  the  next  genera- 
tion to  work  at  too  early  an  age,  they  impair  the  generation's  use- 
fulness, physically  and  mentally,  throughout  life. 

The  social  service  resulting  from  accident  prevention  goes  far 
beyond  mere  economic  consideration,  important  as  these  unques- 
tionably are.  By  eliminating  pain  suffered  by  injured  men  and 
their  possible  lessened  enjoyment  of  life,  by  diminishing  the  misery 
of  the  world,  accident  prevention  is  performing  a  plain  duty  which 
admits  of  no  argument,  is  rendering  simple  justice.  Industrial 
accidents,  so  far  as  they  are  avoidable,  are  not  merely  a  grave  re- 
flection upon  our  economic  wisdom,  they  are  shocking  to  our  moral 

sense. 

Big  as  it  is  in  itself,  accident  prevention  is  leading,  moreover, 
to  other  forms  of  social  betterment.  Recognition  of  the  waste 
involved  in  industrial  accidents  soon  opens  the  way  to  recognition 
of  the  waste  inherent  in  illness  and  in  the  lack  of  proper  living 
conditions,  and  to  a  search  for  the  remedies  for  them.  This  is 
clearly  evident  from  the  efforts  now  being  made  by  many  em- 
ployers, notably  by  some  of  our  large  corporations,  to  eliminate 
causes  of  disease,  general  as  well  as  occupational,  by  assuring  suit- 
able supplies  of  water,  milk  and  other  prime  necessaries  to  the 
families  of  their  workmen,  and  by  offering  scientific  instruction  in 
the  preparation  of  food,   to   reduce   the  consequences  of  illness 


WORLD'S  INSURANCE  CONGRESS  125 

through  the  visits  and  advice  of  competent  nurses,  to  furnish  good 
housing  facilities,  and  social  opportunities,  and  to  encourage  the 
development  of  cheerful  gardens  and  other  surroundings. 

By  bringing  employer  and  employee  into  that  cooperation  with- 
out which  the  full  measure  of  attainment  is  impossible,  accident 
prevention  is  forwarding  industrial  betterment  generally  and  is 
rendering,  indirectly  as  well  as  directly,  social  service  of  the  high- 
est value  and  in  many  directions. 

There  is  nothing  which  does  more  to  bring  men  to  a  clearer  un- 
derstanding of  each  other  in  all  ways  than  for  them  to  meet  face 
to  face  and  work  shoulder  to  shoulder  in  one  way.  This,  I  think, 
is  what  accident  prevention  is  undoubtedly  doing  for  the  general 
betterment  of  society.  Employers  who  become  really  interested 
in  accident  prevention  do  not  stop  there.  Better  working  condi- 
tions in  every  way  follow  inevitably  upon  a  genuine  safety  cam- 
paign. And  the  interest  extends  beyond  the  confines  of  the  indus- 
trial life  proper. 

It  is  the  same  way  with  the  employee.  The  direct  relationship 
with  the  employer  into  which  accident  prevention  activities  bring 
him,  the  feeling  that  he  is  an  active  participant  in  the  movement 
as  well  as  a  beneficiary  of  it,  give  him  a  clearer  view  of  the  whole 
betterment  idea. 

Given  one  common  ground  of  contact,  others  are  bound  to  fol- 
low. Differing  viewpoints  come  to  meet  with  more  and  more  con- 
sideration, and  in  time  to  differ  less  and  less.  There  arises,  slowly 
perhaps  but  surely,  an  increasing  appreciation  of  rights,  benefits, 
happiness  and  welfare.  The  seeds  are  so\\ti  for  an  enduring  in- 
dustrial peace,  and  for  a  united  effort  in  every  possible  field  of 
betterment  which  cannot  help  approximating  eventually,  in  indus- 
try and  beyond  it,  some  degree  of  realization  of  the  spirit  of  so- 
cial cooperation,  of  the  principle  of  the  brotherhood  of  man. 

No  man  connected  with  casualty  insurance  can  fail  to  take  gen- 
uine pride  in  the  notable  part  which  insurance,  through  its  pro- 
motion of  practical  accident  prevention,  thus  has  in  the  rendering 
of  social  service,  or  to  look  forward  with  eager  expectancy  to  the 
broader  opportunity  which  will  come  when  occupational  diseases 
are  universally  brought  within  the  scope  of  Workmen's  Compen- 
sation laws  and  when  sickness  insurance  becomes  general  in  indus- 
try as  well  as  elsewhere. 

There  is  cause  for  the  liveliest  satisfaction  in  the  thought  that 
by  the  natural  and  proper  conduct  of  our  business  we  are  able 
to  be  of  social  service  of  inestimable  value  to  the  world. 


126  WOr?LD*S  INSURANCE  CONGRESS 

SERVICE  PERFORMED  BY  LIFE  INSURANCE  COMPANIES 

"Life  Insurance — What,  Whose,  How?" 

By  Charles  W,  Scovel 
Former  President,  National  Association  of  Life  Underwriters 

Mr.  Chairman,  Ladies  and  Gentlemen :  It  is  a  very  great  pleas- 
ure and  honor  to  be  in  this  presence,  and  have  the  privilege  of 
addressing  you.  This  morning's  session  brought  to  you  the  stories 
of  the  service  of  life  insurance  from  the  representatives  of  the 
old  and  the  new  companies.  I  come  to  the  Congress  as  the  repre- 
sentative of  The  National  Association  of  Life  Underwriters,  a  vol- 
untary body  of  agents  of  all  the  companies  of  standard  class.  I 
am  not  going  to  talk  about  life  insurance  companies,  but  about 
life  insurance.  I  have  taken  for  my  topic  "Life  Insurance — What, 
Whose,  How?" 

The  programmed  topic,  "Service  Performed  by  Life  Insurance 
Companies,"  has  been  fully  discussed  by  the  two  distinguished 
speakers  we  have  just  heard.  What  I  have  to  say  has  its  place 
under  that  topic,  because  the  good  of  society  demands  that  this 
mighty  service,  which  life  insurance  alone  can  render,  shall  as 
speedily  as  possible  be  spread  throughout  the  entiire  population; 
and  because  the  spread  of  that  service  is  bound  to  be  sorely  hind- 
ered and  delayed,  just  so  long  as  intelligent  men  generally  (and 
the  mass  of  life  insurance  men  themselves)  fail  to  realize  and 
apply  certain  broad,  fundamental  facts. 

This  is  to  be  a  plain,  practical  talk  about  these  fundamental 
facts.  They  may  be  grouped  under  the  title — "Life  Insurance — 
What,  Whose,  How?"' 

What  is  life  insurance?  The  habitual  view,  from  without  or 
within,  regards  it  as  merely  a  business.  A  big  business  and  a 
highly  useful  one,  of  course ;  but  not  fundamentally  different  from 
other  important  and  useful  lines.  Habitually  it  is  viewed  as 
though  it  Avere,  like  them,  a  business  owned  mainly  by  the  men  in 
control  and  operated  mostly  as  they  please  and  largely  for  their 
own  profit;  a  business  in  which  there  is  bargaining  and  selling, 
making  and  losing,  prospering  and  failing,  pretty  much  as  in  all 
the  rest. 

Far  be  it  from  me  to  deny  that  life  insurance  is  a  business.  On 
the  contrary  I  glory  in  that  very  fact  as  being  absolutely  indis- 
pensable to  its  social  worth  and  practical  efficiency.  Its  social 
worth  lies  largely  in  the  fact  that  it  stands  squarely  on  the  busi- 
ness basis  of  value  given  and  received.  Its  benefits  are  applied 
for  and  paid  for  by  manly  men,  desiring  to  fulfill  tlieir  own  obli- 
gations. It  is  free  from  the  pampering,  pauperizing  effects  of 
private   philanthropy   or  government  paternalism.     By  no  mere 


WORLD'S  INSURANCE  CONGRESS  127 

accident  does  Uncle  Sam  carry  17  per  cent,  more  life  insurance 
than  all  the  rest  of  the  world  combined.  American  manhood  and 
American  life  insurance  belong  together;  have  grown  great  to- 
gether. They  both  mean  business — and  that  means  independence, 
initiative,  self-respect,  duty  done  and  obligations  met. 

Its  practical  efficiency,  also,  is  attained  by  life  insurance  pre- 
cisely because  it  follows  strict,  up-to-date  business  principles  and 
methods  in  its  organization  and  operation ;  and  because  it  is  striv- 
ing to  reach  all  the  people  by  the  only  practical  means  to  that  end, 
namely,  through  an  army  of  agents  who  themselves  mean  business 
and  do  business. 

Yes,  life  insurance  is  a  business — and  proud  to  be.  But  it  is 
one  that  is  fundamentally  different  from  any  other  business — even 
from  the  other  forms  of  insurance  with  which  it  has  so  much  in 
common.  These  fundamental  differences  have  such  important 
practical  bearings  that  they  should  be  just  as  much  matters  of 
common  knowledge  as  is,  for  instance,  the  distinction  between 
the  savings  bank  and  the  commercial  bank.  For  these  distinctive, 
basic  facts  are  the  very  thing  that  give  life  insurance  its  unique 
stability  and  permanence  and  its  peculiar  fitness  and  capacity  to 
serve  all  the  people. 

First  and  foremost,  life  insurance  is  a  science.  Not  merely  sci- 
entific, or  making  use  of  science.  It  literally  is  a  science.  It  is 
science,  just  as  the  modern  sky-scraper,  from  foundation  to  cor- 
nice, is  steel.  It  is  an  applied  science,  a  natural  science,  the  appli- 
cation of  Nature's  law  of  mortality,  as  astronomy  is  an  applica- 
tion of  her  physical  laws.  The  law  of  death  that  gives  us  aggre- 
gate certainty  to  counterbalance  our  individual  uncertainty,  is  one 
of  the  universal  natural  laws,  ranking  with  the  law  of  birth  that 
balances  the  sexes,  or  the  law  of  gravitation  that  balances  the 
spheres. 

Here  let  us  note  a  very  common  error.  The  actual  subject  mat- 
ter of  this  science  is  not,  as  so  commonly  thought,  the  law  of 
average  or  the  doctrine  of  probabilities.  These  are  general  prin- 
ciples of  mathematics,  used  in  many  fields,  and  by  no  means  pe- 
culiar to  life  insurance.  They  are  the  tools  b^^  which  the  steel  of 
the  mortality  law  has  been  shaped  and  erected  into  the  structure 
we  call  life  insurance.  Actuaries  and  text-writers,  expert  in  using 
these  tools,  often  talk  so  long  and  learnedly  about  them,  as  to  make 
very  many  people  entirely  overlook  the  actual  steel.  The  actual 
stuff  of  which  the  science  of  life  insurance  is  made  is  not  a  law 
of  mathematics,  but  a  law  of  nature.  That  is  what  gives  it  its 
most  decisive  distinction  from  all  other  lines  of  business. 

This  law  of  nature  was  discovered  in  1693  by  Dr.  Edmund 
Halley,  Astronomer-Royal  and  co-worker  with  Newton  in  publish- 
ing the  law  of  gravitation.  It  may  be  broadly  stated  thus:  In  a 
large  group  of  lives  of  the  same  age,  the  number  of  deaths  per 
thousand   climbs  up   year  after  year  in   a  normal,   measureable  \. 

curve,  with  a  longer  upward  step  from  each  year  of  age  to  the 


128       WORLD'S  INSURANCE  CONGRESS 

next.  By  it  we  are  enabled  to  know  to-day  the  maximum  number 
of  deaths  to  be  provided  for  in  each  successive  year  until  all  have 
died.  With  this  fore-knowledge  it  is  a  mere  matter  of  compound 
interest  and  mathematics  to  figure  out,  first,  the  sinking  fund  that 
will  provide  for  all  these  fore-known  deaths  as  they  occur,  and 
then  the  proper  share  that  each  life,  insured  at  this  or  that  age, 
must  pay  into  that  sinking  fund. 

Life  insurance  at  bottom  is  as  simple  and  precise  as  the  work- 
ing out  of  an  issue  of  serial  bonds,  planned  to  mature  so  many 
a  3'ear  for  so  many  successive  years.  Which  particular  bonds  are 
to  be  paid  in  a  given  year  has  nothing  to  do  with  the  problem, 
and  is  unknown  to  any  one  until  decided  at  the  time  by  lot.  How 
many  and  how  much  are  to  be  paid  every  year,  is  all  that  needs 
to  be  known,  in  order  to  have  the  required  amount  ready  in  the 
sinking  fund  on  schedule  time.  Just  so  in  life  insurance.  Every 
death  is  the  maturing  of  a  bond — one  of  the  number  planned  to 
be  paid  that  year,  with  their  total  amount  got  ready  in  the  sink- 
ing fund  just  in  time  for  death  to  cast  the  lot  that  singles  them 
out.  And  so  it  goes  on  year  by  year — each  age-group  climbing  up 
the  curve  of  mortality  and  dwindling  away,  as  each  year's  call  re- 
tires an  ever  larger  proportion  of  the  outstanding  lives,  until  the 
last  of  that  issue  is  called. 

Of  course,  the  operation  of  the  law  of  mortality,  as  of  all  nat- 
ural laws,  is  modified  by  other  forces  brought  into  play  by  varying 
conditions.  Water  boils  at  one  temperature  on  the  seashore  and 
at  another  on  Pike's  Peak.  Halley's  comet  on  one  trip  ran  too 
close  to  two  planets  that  he  had  not  thought  of,  and  so  came  in 
over  a  year  late.  But  even  that  variation  was  long  predicted  by  a 
later  astronomer;  and,  anyhow,  the  comet  promptly  regained  its 
gait  and  in  1911  was  again  keeping  the  seventy-sixth-year  sche- 
dule that  Halley  had  figured  out  in  1682.  In  like  manner,  the 
mortality  law  whose  curve  he  was  the  first  to  figure  has  worked 
out  in  practice  through  the  generations  since.  Its  variations  have 
always  kept  within  the  advance  calculations  of  the  actuaries,  who 
have  unceasingly  studied  its  operation  and  application  among  all 
sorts  and  conditions  of  men. 

Thus  has  evolved  the  great  Science  of  Life  Insurance,  which 
dictates  and  dominates  the  daily  practice  of  life  insurance  among 
all  the  nations — that  science,  complex  but  coherent,  bringing  unity 
out  of  variety,  which  calls  in  the  best  brains  of  medicine,  finance, 
law  and  business  to  aid  in  its  task  of  uniting  thousands  and  even 
millions  of  lives  in  a  single  corporate  organism,  with  countless  age- 
groups  and  policy  classes  and  divisions  by  years  of  entry  and  other 
gi'oupings ;  that  science  which,  amid  all  this  diversity,  justly  pro- 
portions the  payments  of  each  individual  and  maintains  his  equi- 
ties in  sinking  fund,  profit  sharing,  privileges  and  proceeds,  while 
at  the  same  time  husbanding  the  great  common  fund  and  working 
out  the  great  common  purpose  to  the  best  advantage  of  all. 

Now,  the  practical  bearings  of  this  first  fundamental  fact,  that 


WORLD'S  INSURANCE  CONGRESS  129 

life  insurance  is  a  science,  are  varied  and  vital.  The  keystone  of 
that  science  is  its  positive  fore-knowledge  of  future  requirements. 
The  cornerstone  of  its  established  practice  is,  "Safety  First." 
Three  main  results  are  these : 

First:  The  certainty  and  safety  that  are  peculiar  to  this  busi- 
ness-science. In  its  normal  workings  there  is  no  risk  or  hazard; 
the  very  phrase  "death  loss"  is  out  of  place.  A  death,  as  we 
have  seen,  is  not  a  loss,  but  a  maturity — the  fore-known  due  date 
of  a  sinking  fund  bond;  a  bond,  moreover,  that  is  certain  to  be 
called  sooner  or  later.  The  other  forms  of  insurance,  though  rest- 
ing on  formulated  experience  and  wide  distribution  of  risks,  have 
no  such  basis  of  natural  law;  and  as  for  ordinary  business,  it  de- 
pends for  success  or  failure  almost  wholly  on  the  personal  judg- 
ment and  experience  of  its  managers,  and  has  to  take  serious 
chances  all  the  time.  In  the  science  of  life  insurance,  as  in  as- 
tronomy, chance  is  banished  and  the  factor  of  human  error  re- 
duced to  the  vanishing  point.  There  are  scientific  rules  to  govern 
daily  practice  in  all  important  respects ;  the  management  has  only 
to  follow  the  rules  to  be  absolutely  safe. 

Second:  The  stability  and  permanence  that  are  peculiar  to 
this  business-science.  It  has  been  under  the  sheer  necessity  of 
developing  stability  and  permanence  to  the  highest  degree  possible 
in  human  affairs,  because  of  the  long  vista  of  years  it  must  keep  in 
view.  The  deposit  made  to-day  by  a  young  man  may  take  a  hun- 
dred years  to  reach  its  final  goal  in  the  hands  of  a  grandchild  yet 
unborn,  having  meantime  helped  to  provide  life  incomes  succes- 
sively for  his  wife  and  his  daughter.  For  one  hundred  and  fifty 
years  past  life  insurance  has  been  the  world's  one  specialist  in 
financing  its  obligations  a  life-time  ahead.  Part  of  that  job  has 
been  to  devise  and  develop  the  best  possible  system  and  machinery 
for  investing  the  long-time  sinking  fund  that  forms  the  great  bulk 
of  its  assets.  No  other  business  has  to  handle  its  daily  transac- 
tions and  investments  with  the  distant  future  thus  ever  in  view. 
Its  own  permanence  cannot  even  be  questioned.  No  revolutionary 
discovery  or  invention  can  ever  displace  the  material  it  deals  with ; 
that  is  human  life  itself.  Nothing  whatever  can  arise  to  supplant 
its  own  basic  processes ;  they  are  simply  God 's  law  of  human  life- 
time harnessed  to  human  needs. 

Third:  The  equity  and  impartiality  that  are  peculiar  to  this 
business-science.  In  its  essence,  it  is  mathematical,  impersonal,  im- 
partial, dealing  with  individuals  (once  they  are  admitted)  only 
as  fractions  of  the  group.  In  its  practice,  it  is  an  exceedingly 
complex  machinery  with  interlocking  parts  and  interdependent 
functions;  it  must  stick  close  to  its  fixed  rules  of  operation  to 
keep  running  smoothly  at  all.  This  does  not  imply  perfection,  of 
course,  but  it  does  mean  that  the  very  nature  of  the  science  and  its 
practice  powerfully  and  continuously  operate  to  prevent,  discover 
and  remedy  any  breach  of  its  own  sound  rules  and  principles. 
No  other  business  whatever,  nor  any  of  our  social  or  political  in- 


130  WORLD'S  INSURANCE  CONGRESS 

stitutions,  has  any  such  indwelling  scientific  force,  continuously 
operating  to  safeguard  its  workings  against  human  frailty  and 
error.  The  only  possible  parallel  is  the  indwelling  divine  spirit 
of  the  Church.  The  principles  and  rules  of  life  insurance  science 
fix  the  same  terms  for  all,  the  one  thousandth  man  and  the  hun- 
dred thousandth  man  alike,  without  bargaining  or  dicker.  Through- 
out the  process  every  individual's  rights  are  secured  to  him  and 
"his;  but  only  if  he  meets  his  corresponding  obligation,  so  that  the 
rights  of  every  other  individual  may  be  secured.  Life  insurance 
is  the  scientific  incarnation  of  the  square  deal;  the  one  practical 
example  of  pure  democracy  that  man  has  yet  worked  out  on  a  large 
scale. 

Nor  is  this  all.  Back  of  its  business  front,  breathing  the  life 
into  its  scientific  organism,  life  insurance  is  a  cooperation.  It  is  a 
cooperation  actually  and  fundamentally — not  in  some  vague,  gen- 
eral sense,  but  in  the  full  literal  meaning  of  the  word. 

Here  we  reach  the  core  of  the  subject  and  find  that  our  two 
questions,  "What"  and  "Whose,"  converge  to  the  one  great  cen- 
tral truth.  What  is  life  insurance?  Not  merely  a  business  or  a 
science,  but  a  cooperation.  Whose  is  life  insurance?  It  belongs 
not  merely  to  those  interested  as  officers,  or  stockholders  (if  any), 
or  agents;  but  far  more  to  its  policyholders.  It  is  as  a  co- 
operation of  policyholders  that  life  insurance  lives  and  moves 
and  has  its  being.     The  policyholders  are  the  real  owners. 

This  is  no  fine-spun,  fanciful  assertion.  It  is  bed-rock  fact.  Life 
insurance  does  actually  belong  to  the  policyholders.  First,  be- 
cause they  make  it.  It  is  not  made  by  the  company  and  then 
sold  to  them.  If  a  new  company  opened  its  doors  to-day — with  a 
full  array  of  officers  and  agents,  policy  forms  and  literature,  and 
ten  millions  of  gold  in  its  vaults— and  in  the  first  week  or  year 
placed  five  standard  policies  for  a  hundred  thousand  each,  it  would 
not  have  one  single  dollar  of  life  insurance  in  force.  It  would 
simply  have  made  five  bets  on  the  length  of  five  lives.  Life  insur- 
ance is  only  made  by  the  pooling  together  of  enough  lives  for 
nature's  law  or  mortality  to  work  out  its  averages.  The  lives  act- 
ually insure  each  other;  the  company  (whatever  its  form  of  con- 
trol)  is  only  the  central  bureau  through  which  they  do  so. 

This  is  the  scientific  fact  and  the  legal  fact,  too.  The  law  would 
not  allow  our  supposed  ten  million  dollar  company  to  open  its 
doors  until  it  already  had  applications  for  policies  on  the  re- 
quired number  of  lives,  to  be  put  in  force  all  together  on  the 
opening  day.  There  must  be  enough  lives  to  insure  each  other 
before  there  can  be  any  company.  And  every  new  policyholder, 
in  the  very  act  of  adding  his  life  to  the  others,  helps  make  his  own 
insurance  and  theirs,  too.  Thus  the  policyholders,  old  and  new, 
are  at  once  the  raw  material,  the  joint  producers  and  the  con- 
sumers of  life  insurance.  No  such  cooperation  exists  elsewhere. 
In  other  cooperative  concerns  the  members  pool  their  money  and 


WORLD'S  INSURANCE  CONGRESS       131 

their  custom;  here  they  pool,  also,  their  lives  and  their  joint  title 
to  the  henefits  of  God 's  law,  which  none  may  claim  alone. 

Again,  the  policyholders  are  the  real  owners  of  life  insurance 
because  over  97  per  cent  of  the  total  assets  belong  to  them.  The 
company  (whatever  its  form  of  control)  is  only  their  trustee  to 
collect,  invest  and  distribute  that  money.  This  also  is  the  law 
and  the  fact.  Of  the  total  assets  of  $4,935,000,000,  held  by  the  250 
companies  January  1,  1915,  nearly  84  per  cent  is  the  legal  reserve 
held  for  the  whole  body  of  policyholders  as  required  by  science, 
law,  and  contract ;  nearly  3  per  cent  more  is  dividends  and  policy 
proceeds  held  at  the  order  of  individual  owners;  and  over  10 
per  cent  is  made  up  of  special  reserves  set  aside  and  the  general 
surplus  of  purely  mutual  companies.  Besides  this  97  per  cent 
definitely  held  for  them,  the  policyholders  own  an  undivided  in- 
terest in  another  1  per  cent,  the  general  surplus  of  stock  and 
mixed  companies.  All  the  stockholders  there  are  own  less  than 
2  per  cent  of  the  total  assets,  including  their  own  paid-in  capital 
stock,  which  is  a  little  over  1  per  cent.  The  remaining  1  per  cent 
covers  the  miscellaneous  current  liabilities. 

These  figures  are  for  American  life  insurance  as  a  whole,  and 
show  the  policyholders  to  be  the  actual,  lawful  owners  of  all  but 
a  trifling  percentage  of  the  entire  five  billion  dollar  assets.  Taking 
the  stock  and  mixed  companies  by  themselves,  still  the  propor- 
tion owned  by  the  policyholders  is  enormously  the  greater.  Even 
taking  the  younger,  non-participating  stock  companies,  where  pol- 
icyholders own  nothing  but  the  legal  reserve,  that  fund  itself  ex- 
ceeds all  the  rest  after  the  first  few  years  and  keeps  steadily  in- 
creasing its  lead.  The  purely  mutual  companies  without  any 
stockholders  bulk  largest,  holding  over  72  per  cent  of  the  total 
assets — or  83  per  cent,  if  we  include,  as  we  should,  one  company 
which  for  ten  years  has  been  substantially  mutual  and  has  re- 
cently announced  its  intention  to  become  wholly  so. 

Taking  the  business  again  as  a  whole,  last  year  the  total  divi- 
dends, or  refunds,  to  policyholders  were  108  million  dollars,  as 
against  2%  millions  to  stockholders;  97%  per  cent,  as  against  2% 
per  cent.  The  return  to  stockholders  on  their  own  capital  was 
only  5.06  per  cent.  Such  a  rate  cannot  be  called  profits  at  all. 
It  is  merely  interest  on  money  invested,  and  a  very  low  rate  for 
the  risk  involved,  as  is  shown  by  the  large  proportion  lost,  or  spent, 
of  the  money  invested  in  many  new  companies.  Among  the  older 
companies,  large  fortunes  have  been  made  by  stockholders  in  but  a 
few  exceptional  cases — absurdly  few  as  compared  with  any  other 
important  line  of  business.  Viewed  as  a  whole  from  any  angle, 
it  is  perfectly  plain  that  American  life  insurance  is  not  to  be 
classed  as  an  ordinary  proprietary  business,  owned  by  stockholders 
and  run  for  their  profit.  The  great  bulk  of  it  has  no  other  own- 
ers or  profit-sharers  but  the  policyholders  themselves,  and  the  re- 
mainder only  pays  its  stockholders  on  the  average  a  low  interest 
on  their  own  paid-in  capital. 


132  WORLD'S  INSURANCE  CONGRESS 

Historically,  the  mutual  idea  has  dominated  the  development 
of  American  life  insurance,  as  in  no  other  country.  The  oldest 
company,  dating  from  1759,  and  the  eight  next-oldest,  dating  from 
1843  to  1849,  are  all  purely  mutual.  While  stock  management  has 
done  much  to  devise  aggressive  methods  of  reaching  the  people 
and  to  extend  the  scope  of  the  service  offered,  the  purely  mutual 
idea  of  life  insurance  has  from  the  earliest  days  been  the  vital  in- 
fluence in  helping  it  to  realize  more  and  more  fully  its  own  ideals 
as  a  science  and  a  cooperation ;  with  the  result  that  the  policy  priv- 
ileges and  liberal  practices  of  all  our  companies  have  been  for 
many  years,  and  are  to-day,  surprisingly  far  advanced  beyond 
those  prevailing  in  England  and  elsewhere,  though  our  premium 
rates  run  somewhat  lower.  While  evils  and  abuses  have,  of  course, 
crept  in,  they  have  never  been  really  as  dangerous  as  they  looked, 
from  the  outside.  And  now  the  inner,  vital  forces,  working  for 
the  time  ideals,  have  resumed  full  control  in  all  the  important 
companies,  have,  indeed,  become  distinctly  stronger  than  ever, 
through  the  ten  years  of  progress  beginning  with  the  New  York 
investigation.  That  storm  of  indignation  throughout  the  land 
showed  that  the  people  themselves  vaguely,  but  deeply,  sensed  the 
great  truth  that  a  life  insurance  company  is  not  merely  a  business 
concern,  but  essentially  a  trustee  for  its  policyholders. 

Highly  significant  here  is  the  voluntary  mutualization  so  re- 
cently completed  by  the  two  largest  industrial  companies  and 
now  proposed  by  the  remaining  one  of  the  "Big  Six."  These  six 
American  companies  alone  had  in  force  on  January  1st,  25  mil- 
lion industrial  and  5  million  ordinary  policies  for  a  total  insur- 
ance of  over  $12,300,000,000— exceeding  the  total  of  Great  Britain 
and  Ireland,  Germany,  Austria-Hungary  and  France,  all  com- 
bined. Their  truly  imperial  size  shows  how  fully  the  science  of 
life  insurance  has  solved  the  practical  problems  involved  in  earing 
for  millions  of  people  as  members  of  a  single  business  organization. 
And  the  voluntary  retirement  of  the  stockholders  of  the  three 
companies  not  already  purely  mutual — a  thing  wholly  without 
parallel  in  any  other  business — proclaims  a  great  new  principle, 
which  neither  public  opinion  nor  law  had  yet  imposed,  namely: 
That  a  life  insurance  company,  when  it  has  reached  such  vast 
size,  should  properly  be  a  cooperation  of  polic.vholders,  not  only 
in  its  scientific  essence  and  practice,  but  also  in  every  detail  of 
its  corporate  form  and  control. 

All  these  are  distinctive,  basic  facts,  that  help  to  give  Ameri- 
can life  insurance  its  peculiar  fitness  and  capacity  to  serve  all  the 
people. 

Our  answer  is  not  yet  complete.  What  and  whose  is  life  insur- 
ance? It  is  not  only  a  business,  a  science,  a  cooperation,  but  an 
institution.  A  public  institution,  of  world-wide  scope,  like  Church 
or  State — and  ranking  next  after  them  as  one  of  the  three  main 
institutions  in  which  the  millions  of  men  unite  to  advance  the  wel- 
fare of  mankind.     And  as  such  it  belongs,  not  merely  to  its  own 


WORLD'S  INSURANCE  CONGRESS  133 

workers,  nor  even  to  its  policyholders;  but  most  of  all  to  the 
public. 

This  is,  again,  the  law  and  the  fact.  The  United  States  Supreme 
Court  not  long  ago  ruled  squarely  that  ' '  Insurance  is  affected  with 
a  public  interest."  That  this  was  declared  in  a  fire  insurance 
case  makes  the  ruling  all  the  more  significant  as  regards  life  in- 
surance. For  in  life  insurance  the  public  interest  has  been  so 
generally  conceded  by  the  life  men  themselves  that  a  test  case  has 
not  been  even  attempted.  And  that  public  interest  has  always 
been  paramount  in  the  eyes  of  the  law.  For  years  past  life  insur- 
ance has  been  subjected  to  statutory  regulation  and  supervision, 
wise  and  unwise,  that  has  gone  further  into  details  of  manage- 
ment, expenditures,  volume  of  new  business,  surplus,  etc.,  than 
has  been  undertaken  with  any  other  line  of  business,  not  except- 
ing the  public  utility  corporations.  Stockholders'  property-rights, 
sacred  in  private  business,  have  been  no  bar  to  such  regulation  of 
life  insurance.  In  all  States  their  exercise  of  control,  and  in  some 
States  their  very  right  to  profits,  are  sharply  limited  by  laws  and 
charters  that  invariably  favor  and  protect  the  policyholders'  bene- 
ficial ownership  and  rights  and  the  public's  interest  in  the  conduct 
of  the  business  as  a  whole. 

Yes,  life  insurance  does  belong  to  the  public,  to  mankind,  to 
the  present  generation,  and  in  ever-increasing  measure  to  the  gen- 
erations that  are  to  come.  It  would  be  easy  to  talk  a  bookful 
about  its  vast,  vital  services,  social  and  economic,  to  individual, 
family  and  community.  But  those  services  have  been  discussed 
by  others  more  authoritative.  Let  me  add  here  just  a  word  to 
emphasize  our  country's  need. 

As  we  begin  to  realize  what  the  institution  of  life  insurance 
really  means  to  mankind,  now  and  in  future,  we  Americans  can- 
not help  feeling  two  ways  about  it :  Deeply  gratified  that  we  have 
comparatively  so  much;  deeply  concerned  that  we  have  actually 
so  little.  Our  total,  January  1,  1915,  was  2I1/2  billions— 8  6/10 
times  as  much  as  the  United  Kingdom;  5  4/10  times  as  much  as 
Germany;  17  times  as  much  as  Austria-Hungary;  24  times  as 
much  as  France;  17  per  cent  more  than  these  four  leaders  and 
all  the  rest  of  the  world  combined.  That  sounds  gratifying,  surely. 
But  listen :  less  than  7  per  cent  of  the  actual  money  value  of  our 
productive  lives  is  covered  by  life  insurance,  while  our  burnable 
property  is  covered  by  fire  insurance  to  the  extent  of  nearly  80 
per  cent.  Life  values  mean  much  more,  dollar  for  dollar,  than 
property  values;  death  is  a  certainty,  fire  but  a  possibility.  Yet 
our  life  insurance  is  only  1/llth  as  adequate  as  our  fire  insurance. 

Gentlemen,  our  country  sorely  needs  to  have  her  life  insurance 
doubled,  and  then  doubled  again,  in  the  few  years  just  ahead. 
Can  it  be  done  ?    And  how  ? 

What  is  really  the  "How"  of  life  insurance?  How  does  it 
spread?  How  can  it  be  spread  among  the  whole  people?  There 
are  two  possible  ways.    Only  two ;  and  one  of  them  has,  I  believe, 


134  WORLD'S  INSURANCE  CONGRESS 

never  been  tried  for  the  whole  people,  and  never  will  be.  That  one 
is  government  compulsion.  Germany  and  other  nations  have 
applied  it  on  a  large  scale  to  accident,  health  and  old-age  insur- 
ance, among  the  class  of  people  already  near  the  brink  of  poverty. 
But  nowhere  has  compulsory  insurance  of  any  kind  been  applied 
to  tlie  Avhole  people;  and  nowhere,  so  far  as  I  have  heard,  has 
life  insurance  been  made  compulsory  for  any  class.  I  devoutly 
hope  and  believe  that  American  manhood  (unless  in  a  very  lim- 
ited, nearly  submerged  class)  will  never  need,  nor  submit,  to  have 
its  life  insurance  thrust  down  its  throat,  that  it  will  prove  capable 
of  working  out  the  problem  without  throwing  overboard  the 
Declaration  of  Independence.  A  special  solution  for  the  wage- 
earning  class  is  already  begun  in  the  idea  of  group-insurance, 
which  has  vast  possibilities. 

The  only  practical  way  of  insuring  the  people  (whether  indi- 
vidually or  in  groups)  is  by  the  use  of  agents.  There  is  no  third 
alternative  that  offers  either  a  record  of  past  success  or  the 
slightest  prospect  of  future  success.  I  have  no  hesitation  in  af- 
firming broadly  that,  so  long  as  human  nature  remains  the  same, 
no  scheme  (short  of  government  compulsion)  for  spreading  life 
insurance  among  the  w'hole  people,  without  agents,  will  do  much 
more  towards  that  great  end,  than  the  few  small  religious  sects 
without  preachers  will  do  towards  evangelizing  the  world. 

That  is  a  strong  statement.  Is  it  true  and  provable?  Is  the 
agent  really  indispensable?  As  far  as  the  past  can  answer,  the 
entire  record  shouts  "Yes!"  For  the  past  one  hundred  and  fifty 
years  the  companies  and  their  agents,  national  and  state  govern- 
ments, and  sundry  philanthropic  bodies  have  tried  out  every 
kind  of  plan  they  could  think  of  to  spread  life  insurance  with  a 
minimum  of  soliciting  or  none.  In  particular  every  insurance 
manager,  at  home  office  or  branch  office,  and  every  soliciting  agent 
in  the  field,  has  made  it  his  business  to  experiment  with  any  likely 
idea  that  might  result  in  writing  insurance  a  little  more  by  whole- 
sale, so  to  speak,  without  so  much  personal  intervicAving  of  each 
man  by  himself.  All  these  attempts  have  either  failed  or  have 
had  pitifully  small  success,  in  comparison  with  the  results  ob- 
tained by  present  methods. 

The  idea  of  doing  without  agents  has  been  exemplified  by  the 
oldest  British  company  since  1762,  by  the  British  Government's 
post  office  insurance  s.ystem  since  1864,  by  the  Canadian  civil  ser- 
vice system  for  several  decades,  by  the  Massachusetts  savings  bank 
plan  for  eight  years,  by  the  Wisconsin  State  Insurance  Fund  for 
three  years,  and  by  an  American  company,  trying  to  do  a  mail- 
order business  by  advertising  for  ton  years.  These  are  typical  in- 
stances, each  the  least  unsuccessful  of  its  kind.  Without  exception 
the  results  in  insurance  actually  written  have  been  simply  lament- 
able— affording  absolutely  no  promise  of  future  success  upon  any- 
thing like  the  scale  of  the  agent's  results.  Scores  of  single  agen- 
cies are  regularly  writing  in  their  limited  districts  more  insurance. 


WORLD'S  INSURANCE  CONGRESS       136 

and  on  more  people,  than  any  one  of  these  pretentious  efforts  has 
in  its  best  year  written  throughout  the  entire  country  or  state. 
In  certain  of  these  instances  the  expense  has  been  disappointingly 
high,  in  spite  of  aid  from  the  state  or  other  sources.  In  one  of 
them  the  lapse  rate  has  been  enormous,  and  the  mortality  conse- 
quently excessive,  pointing  the  need  of  the  agent's  service  to  keep 
the  insurance  in  force  after  once  written — a  vital  point  commonly 
overlooked  by  outside  critics. 

The  whole  past  record  show  beyond  question  that  life  insurance 
without  the  agent  has  been  a  dismal  failure  as  regards  any  idea 
of  spreading  it  throughout  the  population.  Will  it  always  be  so? 
Is  agentless  life  insurance  a  problem  that  may  yet  be  solved? 
Or  is  there  something  in  the  nature  of  the  business  and  in  the 
nature  of  man,  that  will  always  make  the  agent's  service  indis- 
pensable?    I  think  there  is. 

Every  experienced  agent  will  tell  you  that  his  main  task  with 
almost  every  man,  of  every  class,  is  to  get  him  to  the  point  of 
action,  to  overcome  his  peculiar  habit  of  procrastinating  in  this 
particular  matter  of  taking  out  life  insurance. 

Now,  there  are  three  important  acts  which,  more  than  any 
others,  men  put  off  instinctively,  habitually.  They  are:  making 
one 's  last  will  and  testament,  making  one 's  peace  with  God,  taking 
out  life  insurance.  All  three  are  delayed  for  the  same  reason. 
As  to  each  of  them  a  man's  fixed  mental  attitude  is  "some  time 
before  I  die."  But  his  own  death  is,  in  every  man's  mind,  the 
remotest  contingency,  the  furthest  limit  of  time.  His  hopes,  his 
plans,  his  acts,  are  all  based  upon  the  assumption  that  he  will 
live  on.  As  long  as  human  nature  abides  very  few  indeed  will 
ever  provide  "to-day"  against  that  far-off  contingency  of  death, 
except  they  be  influenced  without.  That  influence  must  be  a  per- 
sonal force  and  it  must  be  brought  to  bear,  strongly,  persistently, 
and  with  every  legitimate  variety  of  attractiveness  and  persuasive- 
ness, to  stem  the  full  tide  of  buoyant  life  that  bears  man  along 
all  his  lines  of  thought  and  action  directly  away  from  the  idea  of 
his  own  death. 

Herein  lies  the  inherent  necessity  for  the  agent.  Mere  oppor- 
tunity, passive  attractiveness,  even  sense  of  duty,  is  not  enough. 
An  active  personal  force  is  needed  to  get  men  to  act  noiv  in  all 
those  preparations  for  death.  There  being  no  agents  to  induce 
men  to  make  wills,  the  state  has  from  sheer  necessity  stepped  in 
with  its  intestate  law  and  made  a  will  for  every  man  who  does 
not  make  one  for  himself.  Otherwise,  the  great  mass  of  men 
would  die  leaving  all  their  property-rights  in  chaos.  The  clergy, 
with  all  the  tremendously  multiplied  and  varied  agencies  of  re- 
ligion, do  the  best  they  can.  with  greater  or  less  success,  to  per- 
suade them  to  prepare  for  death.  Without  their  efforts,  the  great 
mass  of  men  would  die  unprepared.  So  it  is  with  regard  to  life 
insurance.  Voluntary  insurers  have  never  been,  and  never  will 
be,  one  whit  more  plentiful  than  voluntary  converts.  The  need 
for  the  agent  is  rooted  in  the  deepest  traits  of  human  nature. 


136       WORLD'S  INSURANCE  CONGRESS 

Without  his  service,  the  great  mass  of  men  would  die  uninsured. 

The  people  need  the  agent,  not  only  to  start  them  in  the  way, 
but  to  keep  them  going  year  after  year.  The  people  need  him  as 
their  guide,  counsellor  and  friend  in  life  insurance.  They  need 
his  continuing  assistance,  to-day  more  than  ever,  to  apply  the 
modern  income  services  and  other  policy  provisions  to  their  chang- 
ing wants  as  life  goes  on.  They  need  him  throughout  as  the  per- 
son close  at  hand  to  place  confidence  in,  to  personify  to  them  the 
company,  many  miles  away,  and  the  benefits,  many  years  away. 
The  body  of  agents  constitutes  the  actual  priesthood  of  life  in- 
surance. They  are  the  apostles  through  whom  the  insurance  sal- 
vation of  the  world  must  be  accomplished,  and  they  are  the  pastoi'^ 
charged  with  the  personal,  daily  ministry  to  all  the  insurance 
needs  of  their  flocks. 

If  the  agent  is  rendering  a  service  that  is  indispensable  and 
socially  invaluable,  one  would  naturally  expect  it  to  cost  some- 
thing. It  is,  however,  the  supposed  cost  of  the  agent — supposed 
to  be  much  more  than  it  is,  and  to  be  paid  wholly  out  of  the 
policyholders'  pockets,  which  it  is  not — that  has  caused  people 
from  time  to  time  to  try  to  do  away  with  him.  "Life  insurance 
costs  too  much,"  these  good  folks  say,  "and  too  much  of  that 
goes  to  the  agent."  As  a  matter  of  fact,  life  insurance  is  about 
the  only  necessity  of  life  that  has  materially  reduced  its  costs 
during  the  past  fifteen  years  of  rising  prices — and  this  in  spite  of 
liberalized  policies  and  heavier  taxes.  The  total  expense  rate  per 
premium  dollar  for  1914  was  11  per  cent  less  than  in  1899,  and 
14  per  cent  less  than  in  1889;  while  the  agency  expense  rate 
showed  a  21  per  cent  reduction  for  the  fifteen  years  and  a  28  per 
cent  reduction  for  the  twenty-five  years.  The  agent's  cost  was 
cut  more  than  twice  as  deeply  as  the  other  items  of  expense.  In 
1914  his  cost  was  only  12  5/10  per  cent  of  the  premiums.  This  is 
far  below  the  procurement  cost  in  most  lines  of  business  requiring 
salesmen.  That  the  agent  is  not  overpaid  is  well  attested  by  the 
facts  that  it  is  difficult  to  enlist  recruits  and  that  the  large  ma- 
jority of  those  that  are  enlisted  become  discouraged  and  drop  out. 

Moreover,  in  procuring  new  insurance,  the  agent's  cost,  mod- 
erate as  it  is,  does  not  fall  upon  the  old  policyholder  at  all,  as 
is  commonly  thought.  It  is  true  that  some  of  the  general  surplus 
so  used  has  itself  accrued  from  the  mortality  savings  on  the  new 
business  of  the  last  three  or  four  years,  and  the  full  amount  is  duly 
repaid  out  of  the  like  savings  on  that  year's  business.  These  spe- 
cial mortality  savings  are  due  to  the  death  rate  being  very  low 
in  the  new  group,  just  after  medical  examination,  and  rising  grad- 
ually for  five  years  or  more  before  reaching  the  normal  curve. 
In  bringing  in  each  year's  group,  the  agent  thus  brings  in  the 
money  himself  to  pay  his  entire  commission  and  yet  leave  a  bal- 
ance of  roughly  15  per  cent  or  more  of  these  five-year  savings  on 
that  new  group  as  sheer  gain  to  the  policyholders  at  large. 
There  is  another  and  far  greater  kind  of  mortality  savings  ere- 


WORLD'S  INSURANCE  CONGRESS  137 

ated  by  the  agent's  work.  This  is  not  widely  known,  even  inside 
the  business,  and  requires  citation  of  my  authority.  It  is  per- 
ceived by  a  comparison  of  insured  lives  in  the  American  and  the 
British  companies.  The  Encyclopedia  Britannica  (11th  Ed.,  Vol. 
14,  page  667)  quote  Dr.  Emory  McClintock,  foremost  American 
actuary  of  recent  years,  as  stating:  "It  is  an  ascertained  fact, 
that,  after  the  first  five  years  of  insurance,  the  probability  of 
death  in  Great  Britain  is  fully  one-fifth  greater  at  any  given  age 
than  the  corresponding  probability  shown  by  American  experi- 
ence. ' '  After  noting  that  ' '  there  is  no  proof  that  the  average  life 
in  America  is  longer  than  in  England,"  the  Britannica  states  with 
approval  Dr.  McClintock 's  opinion  that  "One  potent  cause  of  the 
great  difference  in  the  insured  experience  is  that,  where  European 
officers  have  generally  awaited  applications,  which  are  commonly 
prompted  by  some  sense  of  need  for  insurance,  the  custom  of 
American  companies  is  actively  to  solicit  business  through  agents. 
On  the  average,  lives  which  are  only  induced  by  persuasion  to 
insure  are  better  than  those  M^hich  voluntarily  apply." 

This  comparison  is  based  on  the  experience  available  in  1892, 
since  which  time  the  American  total  insurance  in  force  has  trebled 
and  new  business  has  doubled,  while  the  ratio  of  the  actual  mor- 
tality to  that  expected  has  in  the  last  fifteen  years  decreased  by 
13  per  cent.  If  the  figures  could  be  had  down  to  date,  they  might 
well  show  the  mortality  savings  in  this  respect  to  be  much  greater 
than  the  20  per  cent  calculated  from  the  earlier  data. 

Thus  the  American  agent  has  not  only  made  our  life  insur- 
ance 3.6  per  cent  larger  than  England's,  but  his  hand-picked  as- 
sortment of  lives  is  saving  20  per  cent  and  upwards  on  the  death 
claims  being  paid  year  after  year.  Precisely  how  much  of  that 
difference  is  due  to  the  agent 's  work  cannot  be  figured  out.  Other 
elements  enter  in,  but  the  agent  who  is  admittedly  the  chief 
factor,  is  the  only  one  even  mentioned  in  the  Britannica 's  dis- 
cussion. On  last  year's  death  claims  the  amount  saved,  if  20 
per  cent,  was  30  million  dollars ;  if  30  per  cent,  45  millions.  And 
this  is  continuous  year  after  year.  There  is  leeway  enough  in 
these  figures  to  compute  the  agent's  proportion  on  a  higher  or 
lower  basis,  and  yet  be  quite  sure  that  the  amount  thus  saved  by 
him  on  the  general  continuing  mortality,  plus  the  balance  of  15 
per  cent  or  more  on  the  initial  five-year  mortality,  already  re- 
ferred to,  must  go  a  long  way  toward  paying  his  own  cost. 

Add  to  these  two  amounts  the  saving  in  lapses,  which  were 
about  the  greatest  waste  in  the  business,  but  have  decreased  50 
per  cent  in  twenty  years,  almost  wholly  through  the  agent's  con- 
tinuing service  after  first  writing  the  policy.  Add  also  the  sav- 
ing in  the  average  overhead  cost  per  thousand  dollars,  due  to  the 
agent's  work  in  building  up  the  vastly  larger  volume  of  business 
in  force.  Then  add  the  many  differences  between  the  expenses  of 
companies  as  now  conducted  with  agents,  and  those  that  would 
have  to  be  incurred  if  without  agents,  for  such  items  as  adver- 


138  WORLD'S  INSURANCE  CONGRESS 

tising,  printing,  postage,  collections,  clerk  hire,  etc.  If  we  could 
only  figure  out  all  these  elements  and  add  them  together,  I  verily 
believe  that  the  complete  figures  would  nearly,  perhaps  wholly, 
equal  the  agent's  entire  cost.  Even  though  the  precise  amount 
cannot  be  figured,  the  actual  savings  are  being  made ;  the  real 
monej'  is  there,  and  is  known  to  be  a  great  sum  yearly. 

Thus  the  agent  pays  the  great  part  at  least  of  his  own  cost 
with  money  that  he  creates — money  that  could  not  be  there  if  he 
were  not — money  that  would  otherwise  be  paid  out  in  the  higher 
mortality,  waste  and  expense,  directly  caused  by  his  absence.  That 
means  that  the  agent's  indispensable  and  invaluable  social  service 
is  rendered  with  only  a  fraction  of  its  actual  cost  really  borne  by 
any  of  those  he  serves.  No  one,  knowing  the  facts,  could  well 
complain  of  that. 

Now  we  have  the  bird's-ej'c  view  of  Life  Insurance:  A  public 
institution ;  existing  for,  and  owned  by,  the  millions  who  cooperate 
through  it;  with  precisely  the  type  of  business  organization  in 
home  office  and  field  that  is  indispensable  to  its  efficiency  and  its 
spreading  among  the  people.  This  business  organization  and  its 
personnel  bear  precisely  the  same  relation  to  life  insurance  that 
the  paid  secretary  does  to  the  building  and  loan  association;  that 
the  officers  and  tellers  bear  to  the  mutual  savings  bank;  or,  for 
that  matter,  the  same  that  preacher,  choir  and  sexton  bear  to  the 
church,  or  that  the  secretary  and  paid  visitors  bear  to  the  Asso- 
ciated Charities.  All  are  but  the  machinery  by  which  alone  the 
institution  can  efficiently  do  its  work  in  the  world. 

American  life  insurance  stands  to-day  fundamentally  fit  and 
practically  equipped  to  meet  the  needs  of  all  the  people,  and  to 
grow  with  those  needs  in  the  limitless  future.  As  a  scientific 
cooperation  it  approximates  its  own  ideals  more  closely  than  ever 
before,  more  closely  than  its  brothers  across  the  seas.  As  a  busi- 
ness machinery,  both  for  administration  of  its  high  trust  and  for 
spreading  its  needed  service  most  widely,  it  far  out-distances  any- 
thing in  the  records  of  past  experiment  or  suggested  to-day  by 
well-meaning  bystanders. 

The  great  thing  needful  is  that  all  the  people  shall  know  Amer- 
ican life  insurance  for  what  it  is;  that  ignorance,  error,  and  sus- 
picion shall  be  replaced  in  every  quarter  by  full  knowledge  and 
hearty  cooperation.  That  all  the  people  shall  know  that  life  in- 
surance is  theirs,  their  product  and  their  property,  their  friend 
and  helper.  That  all  friends  of  progress  shall  realize  that  life 
insurance  the  social  service,  and  life  insurance  the  business,  are 
one  and  inseparable,  and  that  the  service  cannot  by  any  possi- 
bility be  spread  among  the  whole  people  except  through  these 
business  methods  of  proven  success. 

"What  is  wanted,"  wrote  Elizur  Wright  in  1872— he  who  first 
persuaded  the  State  to  safeguard  the  people's  life  insurance — 
"What  is  wanted  is  that  the  schoolhouse  and  the  press,  the  uni- 
versal educators,  shall  take  up  the  matter,  not  in  the  interest  of 


WORLD'S  INSURANCE  CONGRESS  139 

the  companies  or  their  agents,  but  in  that  of  the  public  and  its 
coming  generations." 

That  is  the  keynote  I  want  to  leave  reverberating — "Not  in  the 
interest  of  the  companies  or  their  agents,  but  in  that  of  the  public 
and  its  coming  generations."  That  gives  us  the  final  word  of  the 
answer  we  have  been  seeking.  What  is  life  insurance?  It  is  not 
only  business — science — cooperation — institution;  it  is  a  Cause; 
the  cause  of  the  people,  the  cause  of  the  future  generations. 

The  cause  is  yours — and  mine ;  whether  we  have  anything  to  do 
with  life  insurance  personally,  or  not.  We  are  our  brother's 
keeper,  if  only  in  self-defense.  He  cannot  go  wrong  without  harm- 
ing us;  nor  his  children,  without  harming  ours.  And  so  I  urge 
each  one  of  you  that  hears  (or  reads)  these  words:  Be  yourself 
one  of  those  "universal  educators",  as  Wright  called  the  school- 
house  and  press.  More  potent  than  they  is  the  spoken  word  from 
man  to  man  in  daily  intercourse.  That  is  what  really  makes  pub- 
lic opinion  the  mightiest  force  on  earth.  Now  that  you  have  been 
thinking  a  while  on  these  fundamental  truths  of  life  insurance  and 
have,  I  hope,  a  clearer  view  of  them,  go  out  and  tell  others  about 
them  and  tell  them  to  pass  the  good  word  on. 

With  the  way  cleared  to  the  hearts  of  the  people,  and  cordial 
cooperation  from  those  who  work  for  human  progress,  the  whole 
social  outlook  for  the  future  will  of  a  certainty  be  illuminated  by 
life  insurance  with  a  light  that  never  was  on  land  or  sea.  That 
future  outlook,  thus  illumined,  cannot  be  measured  by  the  past. 
Its  vista  spreads  out  ahead,  fan-shape,  ever-widening.  The  total 
sums  to  be  distributed  by  life  insurance  are,  and  will  be,  growing 
fast ;  and  their  usefulness  will  be  growing  yet  faster  as  they  come 
to  be  paid  out  more  and  more,  not  as  spendable  principal,  but  as 
dependable  income.  The  proportion  of  the  whole  population 
reached  by  these  sums  keeps  also  growing  faster  and  faster.  And 
with  each  generation  opportunity  gets  broader  and  freer,  and  per- 
sonal capacity  to  make  the  most  of  it  spreads  and  grows  by  leaps 
and  bounds. 

Life  Insurance  is  the  strong,  helpful  arm  that  each  generation 
stretches  out  to  the  next.  To  do  anything  we  can  to  strengthen 
and  lengthen  that  arm  is  for  all  of  us  a  social  service  and  a  social 
duty. 


SERVICE    PERFORMED    BY    CREDIT    INSURANCE 
COMPANIES 

By  E.  M.  Treat 
President,  American  Credit-Indemnity  Company 

The  amount  of  annual  losses  by  bad  debts  is  a  stupendous  tax 
upon  the  interests  of  this  country.  These  losses  are  greater  than 
the  waste  through  fires. 


140       WORLD'S  INSURANCE  CONGRESS 

An  agency  that  applies  the  insurance  principle  of  distributing 
the  burden  of  such  losses,  that  helps  to  prevent  the  abuse  of  credit, 
that  renders  efficient  service  in  the  granting  of  credit  and  the  col- 
lection of  accounts,  that  checks  over  expansion  of  credit  without 
placing  an  undue  restriction  upon  it,  that  provides  a  guarantee 
which  controls  an  otherwise  uncontrollable  loss  ratio,  is  undenia- 
bl}^  a  valuable  aid  to  the  safe  conduct  of  business.  This  Credit  In- 
surance does. 

Fire  insurance  is  carried  to  prevent  losses  on  goods  in  store  or 
warehouse  where  they  are  under  the  merchant's  control.  Credit 
insurance  provides  a  protection  against  excessive  losses  after  the 
goods  have  changed  to  the  form  of  accounts  and  are  not  under  his 
control.  This  protection  starts  where  those  of  all  other  forms  of 
insurance  have  finally  performed  their  useful  purpose :  credit  in- 
surance protects  that  part  of  a  business  which  represents  the  fruit- 
age of  the  combined  efforts  of  a  wholesale  mercantile  organization 
— the  accounts. 

Credit  insurance  is  a  guarantee  that  a  wholesale  merchant  shall 
not  suffer  from  losses  occurring  during  the  term  of  the  policy,  on 
account  of  the  insolvency  of  debtors  coming  within  the  coverage 
of  the  policy,  which  are  in  excess  of  the  normal  amount  incident 
to  his  particular  business.  The  indemnified  has  the  privilege  of 
selecting  a  policy  under  which  he  handles  his  own  collections  or 
one  where  the  company  renders  to  him  the  collection  service. 

This  normal  amount  is  the  initial  loss  to  be  borne  by  the  In- 
demnified. The  net  excess  over  the  initial  loss  is  the  amount  guar- 
anteed to  be  paid  to  the  policyholder. 

Under  the  policy  the  Mercantile  Agency  ratings  upon  which  the 
insurance  is  based  are  classified  and  coverage  graded  accordingly. 
The  policy  affords  full  protection,  within  specified  limits,  on  pre- 
ferred customers  with  good  ratings  and  for  an  extra  premium 
gives  additional  protection  where  a  limited  co-insurance  on  cus- 
tomers who  have  inferior  ratings  is  desired. 

The  ascertainment  of  and  the  agreement  upon  the  Initial  Loss, 
or  the  loss  which  is  inherent  or  normal  to  the  particular  house 
insured,  is  the  prime  factor  concerned  in  this  class  of  underwrit- 
ing. Instead  of  exacting  a  cash  premium  to  cover  the  losses  nor- 
mally incident  to  the  business  insured,  plus  the  loading  for  the 
excess,  it  is  more  practical,  more  satisfactory  and  removes  any 
speculative  feature,  simply  to  provide  that  the  indemnified  shall 
.stand  the  loss  normal  to  his  business  (which  in  reality  is  no  loss  at 
all,  it  being  absorbed  in  the  shelf  cost  of  tlie  goods)  and  receive 
indemnity  for  the  excessive  losses. 

There  are  in  practice  two  methods  of  fixing  the  initial  loss  rate, 
the  forms  of  policies  being  constructed  accordingly.  The  initial 
loss  may  be  determined  at  the  beginning  of  the  term  of  the  con- 
tract and  be  made  fixed  and  binding  upon  both  the  insured  and 
the  company,  which  involves  being  loaded  in  advance;  or  the  aver- 
age normal  basic  rate  may  be  fixed  at  the  time  the  insurance  is 


WORLD'S  INSURANCE  CONGRESS  141 

issued  and  the  ascertainment  of  the  final  or  binding  rate  left  until 
the  end  of  the  term,  when  the  loss  experience  of  the  insured  during 
the  term  of  the  policy  is  available  as  a  factor  in  the  determination 
of  the  proper  initial  loss.  If  a  merchant  doing  one  million  dollars 
a  year  has  a  normal  loss  experience  of  1/2  of  1  per  cent  and  during 
the  currenc}^  of  the  policy  loses  double  the  usual  amount,  the  com- 
pany guarantees  to  pay  his  losses  in  excess  of  6/10  of  1  per  cent. 
The  preliminary  procedure  in  adjusting  the  insurance  to  the 
needs  and  requirements  of  the  insured  is  the  same  whether  the 
initial  loss  shall  be  upon  a  tlat  or  fixed  basis  or  upon  the  normal 
average  plan.  The  application  form  of  the  policy,  taken  in  con- 
nection with  the  amount  of  insurance  desired  and  the  size  of  the 
accounts  to  be  covered,  brings  out  the  information  necessary  to 
enable  the  underwriter  by  a  display  of  good  business  sense  and 
sound  judgment  to  formulate  fair  and  reasonable  terms. 

The  service  rendered  through  credit  insurance  consists  not  alone 
in  the  large  sums  of  money  it  has  distributed  to  the  advantage  of 
the  policyholders,  but  potentially  it  exerts  a  wholesome  and  help- 
ful influence  in  strengthening  and  regulating  credit,  preventing 
waste,  and  in  the  conduct  of  mercantile  affairs  generally. 

Service  to  Maintain  Credit:  Notwithstanding  the  difference  be- 
tween banking  and  mercantile  pursuits,  there  is,  in  one  respect, 
a  clear  analogy  between  them. 

The  merchant  makes  his  profit  on  the  sale  of  his  goods  at 
prices  exceeding  the  cost,  plus  expenses,  plus  losses  on  credit 
accounts. 

The  banker  deals  in  money,  a  medium  of  exchange;  his  main 
profits  are  the  aggregate  of  discounts  and  interest,  less  expense, 
less  losses  on  credit  accounts. 

Both  extend  credit  to  their  customers.  The  banker  has  the 
advantage ;  he  can  lend  or  not  as  he  choses ;  he  generally  exacts 
approved  security,  or  being  the  sole  source  of  supply  to  his  bor- 
rower is  in  intimate  touch  with  his  affairs.  In  either  case  there 
is  involved  some  peril  and  in  a  long  series  of  transactions  there 
is  certainty  of  loss.  In  the  banker's  case,  his  transactions  being 
safeguarded  by  security,  the  losses  are  reduced  to  a  minimum; 
while  in  the  case  of  the  merchant,  who,  by  custom  and  compe- 
tition is  compelled  to  sell  to  the  many  on  credit  without  security 
and  even  without  interest,  the  losses  are  much  larger. 

To  remove  the  peril  of  credit  losses  to  the  merchant  and  place 
him  in  the  nearest  possible  approach  to  the  position  of  the  banker, 
is  what  credit  insurance  goes  far  toward  accomplishing.  It  does  so 
by  reducing  the  credit  losses  to  a  fixed  average  of  the  amount  of 
the  annual  sales.  Within  well  defined  limits,  a  merchant  may 
know,  each  year  in  advance,  what  his  losses  from  the  insolvency 
of  his  debtors  will  be  and  can  make  definite  arrangements  to 
provide  for  it.  He  is  not  compelled  to  hold  any  material  portion 
of  his  capital  in  reserve  for  the  unexpected  losses.  The  credit 
losses  being  eliminated  from  his  business,  the  merchant,  being  for- 


142       WORLD'S  INSURANCE  CONGRESS 

tified  by  insurance  on  all  other  phases  of  his  affairs,  is  in  a  posi- 
tion to  conduct  his  business  with  confidence  and  safety  and  will 
stand  in  a  better  position  to  get  accommodations  from  his  banker. 

All  this  makes  for  stability  in  credit.  What  merchant,  upon  the 
first  approach  of  a  flurry,  becomes  excited  over  his  outstandings 
and  plays  a  part  in  trouble  making?  Not  the  one  possessing  credit 
indemnity.  In  like  times  the  wise  banker  does  not  become  troubled 
about  his  borrower  who  has  fortified  himself  against  all  contin- 
gencies. Credit  insurance  promotes  confidence  and  confidence 
maintains  credits. 

Service  to  Regulate  Credit:  It  encourages  trading  with  those 
growing  in  financial  strength  and  paying  ability  by  its  protection 
immediately  following  all  shipments  made  on  increasing  ratings, 
and  it  guides  away  from  those  who  are  known  to  be  growing  weak 
by  lessening  or  ceasing  its  protection  on  all  decreasing  ratings. 
The  Mercantile  Agency  ratings  and  reports,  while  not  at  all  con- 
clusive to  the  careful  credit  man,  constitute  the  universally  ac- 
cepted guide  in  credit  granting.  These  ratings  represent  a  general 
letter  of  credit,  but  the  possibility  of  their  abuse  in  making  pur- 
chases in  any  or  every  market  brings  concern.  Credit  insurance 
suggests  the  safe  and  the  unsafe  in  credit  ratings  and  measures 
its  coverage  accordingly. 

Service  to  Keep  Merchants  Better  Informed  on  Their  Affairs: 
Under  the  operation  of  credit  insurance  a  merchant  becomes  posted 
on  every  phase  of  his  accounts  from  the  initial  stage  of  granting 
credit  to  the  collection  of  the  account,  whether  before  or  after  in- 
solvency of  the  debtor.  He  is  made  to  know  his  sales  and  losses; 
he  becomes  accurately  informed  as  to  his  outstanding  accounts 
and  the  condition  thereof;  how  much  is  overdue  and  how  long; 
those  under  extension  and  seeking  extension,  and  those  who  have 
reached  a  stage  calling  for  positive  measures.  It  is  a  system  that 
enables  him  to  keep  his  business  well  in  hand.  This  brings  about 
a  very  appreciable  saving  in  the  aggregate.  In  this  connection, 
policyholders  are  furnished  monthly  a  business  barometer,  a  service 
to  keep  them  informed  as  to  the  fundamental  conditions  over 
which  the  merchant  in  any  particular  business  has  no  control,  but 
to  the  trend  of  which  any  business  may  be  adjusted  so  as  to  avoid,^ 
as  far  as  possible,  material  losses  during  business  reactions  and' 
to  increase  profits  during  prosperity.  This  barometer  indicates 
graphically  whether  the  tendency  of  business  is  safe  or  unsafe 
and  enables  the  merchant  to  anticipate  reactions  which  are  pending 
and  inevitable. 

Service  in  Cases  of  Delinquent  Accounts:  The  insurance  com- 
pany and  the  policyholder  being  mutually  interested  in  all  ac- 
counts, the  company  is  always  willing  to  use  its  efforts  in  making 
settlements.  Under  one  form  of  credit  insurance  a  service  before 
and  after  insolvency  is  rendered.  The  policy  provides  that  where 
an  account  not  over  sixty  days  past  due  has  been  placed  for  col- 
lection with  the  company  and  there  has  been  a  failure  to  effect 


WORLD'S  INSURANCE  CONGRESS  143 

collection  thereof  Avithin  ninety  days  thereafter,  it  becomes  a 
provable  claim  under  the  policy.  Valuable  service  is  provided 
not  only  on  live  accounts  but  in  cases  of  insolvency  where  creditors 
themselves,  either  through  ignorance  of  various  laws  or  by  care- 
lessness, do  not  preserve  their  rights. 

Conclusion:  Credit  insurance  performs  this  important  service: 
It  adds  to  a  merchant's  capital,  at  small  cost,  a  special  reserve 
equal  to  the  face  of  the  policy,  to  most  unexpected  losses  in  busi- 
ness. 

It  offers  collateral  security  against  the  calamities  which  come 
upon  preferred  customers  and  co-insurance  on  customers  with  in- 
ferior ratings. 

It  affords  a  guaranty  that  losses  on  merchandise  sold  during  the 
year  covered  shall  not  exceed  a  normal  percentage  of  the  gross 
sales. 

It  affords  profits  against  impairment  through  unexpected  and 
unavoidable  losses. 

It  protects  against  a  risk  which  every  merchant  must  otherwise 
take. 

It  helps  in  preventing  losses  and  assists  in  collecting  overdue 
accounts. 

Credit  insurance  is  an  economic  movement  in  the  right  direction, 
and  performs,  as  does  all  insurance,  an  important  part  in  the 
betterment  of  citizenship. 


SERVICE  PERFORMED  BY  MARINE  INSURANCE 
COMPANIES 

By  J.  B.  Levison 
Vice-President,  Fireman's  Fund  Insurance  Company 

The  subject  I  have  been  asked  to  discuss  this  afternoon,  "Service 
Performed  by  Marine  Insurance  Companies, "  is  so  broad  and  com- 
prehensive as  to  put  any  detailed  consideration  out  of  the  question 
in  the  very  short  time  allotted  to  me.  I  will,  therefore,  simply  en- 
deavor to  outline  as  concisely  as  possible,  the  most  important  fea- 
tures of  marine  underwriting  in  its  relation  to  the  development 
of  the  human  race,  touching  upon  its  history,  the  influence  it  has 
had  on  the  exploration  and  exploitation  of  new  and  undeveloped 
countries,  its  close  relation  to  the  commercial  development  of  the 
W'Orld,  and  finally  the  very  important  part  it  has  taken  in  the 
present  great  war. 

Marine  insurance  is  the  oldest  form  of  indemnity  known.  It  is 
generally  supposed  to  have  had  its  beginning  contemporaneously 
with  the  birth  of  commercial  activity  in  the  Mediterranean  about 
the  twelfth  century,  but  unfortunately  little  is  known  respecting 
its  conduct  at  that  time.    English  authorities  tell  us  that  the  Lorn- 


144       WORLD'S  INSURANCE  CONGRESS 

bards  introduced  marine  insurance  into  London  during  the  thir- 
teenth century  and  a  form  of  policy  is  described  in  a  Florentine 
statute  of  about  1500  A.D.,  bearing  a  very  remarkable  resemblance 
to  the  policy  which  has  been  in  use  in  London  since  the  latter 
part  of  the  sixteenth  century,  when  practically  all  of  the  countries 
in  Europe  established  rules  and  laws  for  the  government  of  marine 
insurance.  At  that  time  the  business  was  done  altogether  by  indivi- 
duals on  what  we  know  to-day  as  Lloyd's  plan.  The  first  stock 
companies  organized  for  the  transaction  of  marine  insurance  busi- 
ness were  chartered  in  England  in  1720  and  in  America  in  1792. 

It  is  a  very  interesting  fact  that  the  development  of  the  busi- 
ness of  marine  underwriting  in  any  particular  country  has  always 
run  parallel  with  the  growth  of  its  merchant  marine.  Prior  to  the 
Civil  War,  when  the  American  mercantile  marine  was  at  its  zenith, 
the  United  States  had  many  more  marine  insurance  companies  than 
Great  Britain,  but  with  the  disappearance  of  the  American  Flag 
from  the  high  seas  the  amount  of  American  capital  invested  in 
marine  insurance  steadily  decreased  until  1905,  when  there  were 
but  three  domestic  companies  doing  a  marine  business  exclusively 
and  eleven  companies  writing  marine  business  in  connection  with 
other  branches.  To-daj^,  owing  to  the  anticipated  development  of 
the  American  mercantile  marine  as  the  result  of  the  completion 
of  the  Panama  Canal  and  the  general  agitation  on  the  subject 
throughout  the  country,  there  are  twenty-two  American  companies 
engaged  in  the  marine  insurance  business.  It  is  also  an  interesting 
collateral  fact  that  most  of  the  leading  British  marine  offices  now 
in  existence  were  organized  in  the  early  sixties,  or  in  other  words, 
during  the  American  Civil  War. 

Marine  underwriting  is  an  absolute  necessity  in  the  exploitation 
of  new  and  undeveloped  countries.  This  can  readily  be  explained 
by  the  mere  statement  that  no  merchant  or  corporation,  no  matter 
how  wealthy,  would  undertake  to  send  valuable  vessels  with  their 
cargoes  into  new  and  unexplored  countries  without  the  protection 
afforded  by  marine  insurance.  An  excellent  illustration  of  this  is 
in  the  development  of  Alaska,  where,  since  its  acquisition  by  this 
country  in  1869,  vessels  have  been  trading  which  carry  valuable 
supplies  north  and  return  with  furs,  salmon,  gold,  etc.,  fre- 
quently running  into  millions  in  value.  The  dangers  of  the 
Alaska  coast,  due  to  inefficient  lighting  and  inadequate  aids  to 
navigation,  leads  one  to  view  with  surprise  the  fact  that  marine 
underwriters  had  sufficient  hardihood  to  undertake  the  business, 
but  high  rates  and  the  possibility  of  large  profits  were  naturally 
attractive  with  the  result  that  the  business  has  been  written  com- 
paratively freely  and  the  necessary  protection  afforded  merchants 
and  trading  companies.  I  think  it  is  quite  within  the  mark  to  say 
that  without  this  protection  Alaska  never  would  have  become  the 
valuable  asset  to  the  United  States  that  it  is  to-day. 

The    influence   of   marine   insurance   on   the   commerce   of  the 
world  in   general   requires  no  extended  discussion.     No  business 


WORLD'S  INSURANCE  CONGRESS  145 

concern,  whether  corporate  or  individual,  conducts  its  affairs  to- 
day without  some  form  of  marine  insurance.  The  exporter  with 
marine  insurance  policies  attached  to  his  invoices  and  bills  of  lad- 
ing can  obtain  an  advance  from  his  bankers  approximating  th^ 
value  of  the  shipment.  The  importer  through  the  protection  of 
marine  insurance  can  have  letters  of  credit  issued  against  which 
drafts  may  be  dra'wn  by  buyers  in  any  part  of  the  world.  In 
addition  to  this,  the  merchant  may  also  insure  his  anticipated 
profits  so  that  he  not  only  has  been  enabled  to  obtain  funds 
promptly  in  the  shape  of  an  advance,  as  just  described,  but  he 
also  has  his  profits  guaranteed  to  him  against  loss  by  perils  of  the 
seas  through  the  agency  of  marine  insurance. 

The  part  marine  insurance  has  played  in  the  present  great  war 
must  have  impressed  itself  upon  all  by  what  has  been  written  on 
the  subject  of  war  risk  insurance,  the  importance  of  which  can 
best  be  illustrated  by  the  fact  that  Great  Britain  practically  on 
the  very  day  she  declared  war  established  a  Government  War 
Risk  Bureau  and  called  upon  some  of  the  leading  marine  men  of 
Great  Britain  to  direct  its  affairs.  Without  this  Government  Bu- 
reau, war  risk  rates  would  undoubtedly  have  been  much  higher, 
which  was  fully  warranted  by  the  hazards.  High  war  risk  insur- 
ance rates  would,  however,  have  seriously  interfered  with  British 
commerce  and  the  British  Government,  clearly  appreciating  the 
commanding  importance  of  this,  has,  it  is  believed,  been  willing  to 
operate  the  War  Risk  Bureau  at  a  considerable  loss.  This  loss, 
however,  is  nothing  as  compared  with  the  extraordinary  cost  of  the 
war,  especially  when  the  fact  is  considered  that  marine  insurance 
companies  the  world  over  have  thereby  been  forced  to  write  insur- 
ance for  British  vessels  at  much  lower  rates  than  would  otherwise 
have  been  done. 

Many  other  countries,  including  the  United  States,  appreciating 
the  value  of  a  Government  War  Risk  Bureau,  as  demonstrated  by 
Great  Britain,  have  established  similar  departments  for  the  pro- 
tection of  their  own  vessels.  The  result  of  this  undoubtedly  has 
been  that  commerce  between  the  nations  has  been  stimulated  and 
maintained  at  a  comparatively  small  cost  to  the  nations  them- 
selves. 

No  paper  on  marine  insurance  would  be  complete  without  a 
reference  to  the  expression  "Lloyd's"  which  is  so  frequently  used 
in  connection  with  shipping  and  underwriting  affairs.  We  are  told 
that  it  has  all  come  down  from  one  Edward  Lloyd,  the  owner  of  a 
coffee  house  in  London  about  1690,  which  was  the  rendezvous  for 
ship-masters,  shipping  men  and  merchants  generally  during  the 
last  half  of  the  seventeenth  century  and  which  generally  became 
a  central  point  for  all  persons  connected  with  shipping.  From 
this  simple  beginning  has  developed  the  use  of  the  word  "Lloyd's" 
until  to-day  it  is  almost  universally  understood  as  having  some 
definite  relation  to  maritime  affairs. 

In  conclusion  and  to  address  myself  particularly  to  the  sub- 


146       WORLD'S  INSURANCE  CONGRESS 

ject  this  day  is  designed  to  emphasize,  marine  insurance  has  been 
a  factor  of  the  highest  importance  in  consemnng  life  and  prop- 
erty. jNIarine  underwriters  have  always  been  to  the  forefront  as 
originators  and  active  supporters  of  classification  registers,  which 
provide  rules  and  regulations  for  the  construction  of  vessels  and 
subsequent  regular  supervision,  thereby  insuring  structural  strength 
and  a  maximum  of  safety.  Further,  marine  underwriting  organi- 
zations have  their  own  surveyors  at  almost  every  port  of  impor- 
tance on  the  globe,  to  inspect  vessels  before  loading  and  supervise 
the  loading  itself,  which,  it  is  needless  to  say,  is  almost  of  para- 
mount importance. 

Unfortunately  time  does  not  permit  any  further  discussion  of 
the  subject,  but  enough  has  been  said,  I  hope,  to  convey  to  the 
members  of  the  Congress  the  fact  that  marine  insurance  is  a 
factor  of  the  very  highest  importance  in  the  conservation  of  life 
and  property  as  well  as  the  maintenance  of  credit  and  the  develop- 
ment of  commerce. 


THE  FORCE   OF   INSURANCE  IN   SOCIAL  ECONOMY 

By  Alvin  E.  Pope 

Chief  of  Education  and  Social  Economy,  Panama-Pacific  Interna- 
tional Exposition 

As  this  subject  is  to  be  dealt  with  from  an  Exposition  point  of 
view,  it  will  be  necessary  to  first  outline  the  functions  of  an  Ex- 
position. 

The  modern  International  Exposition  is  a  huge  machine,  or- 
ganized for  the  purpose  of  collecting  ideas  of  merit  from  each  and 
every  part  of  the  globe  and  for  disseminating  them  throughout  the 
nations  of  the  world.  Many  of  these  ideas  are  new,  often  being 
confined  to  a  people,  or  restricted  to  a  very  limited  locality.  One 
exposition  brought  forth  the  reaper,  another  the  telephone.  The 
Philadelphia  Centennial  introduced  the  course  dinner  into  this 
country.  The  Chicago  Exposition  was  followed  by  a  nation  wide 
movement  for  beautifying  our  cities.  The  St.  Louis  Exposition 
by  a  new  movement  for  the  beautification  of  our  homes.  Mr.  A. 
N.  Palmer  would  probably  still  be  teaching  his  method  of  penman- 
ship in  a  small  town  in  Iowa,  if  the  St.  Louis  Exposition  had  not 
placed  him  on  the  map.  Now  the  Palmer  Method  is  in  use  from 
coast  to  coast.  The  finger  print  system  was  not  in  use  by  a  single 
police  department  at  the  time  of  the  St.  Louis  Exposition.  The 
finger  print  exhibit  at  that  Exposition  led  to  the  establishment 
of  a  finger  print  bureau  in  the  police  department  of  every  large 
city  in  this  country.  The  Exposition  also  acts  as  an  instrument 
for  making  ideas,  which  are  already  well  known,  better  known, 
and  spreading  them  into  remote  districts  where  they  are  practi- 


WORLD'S  INSURANCE  CONGRESS  147 

cally  unknown,  thus  further  intensifying  their  usefulness.  This 
is  illustrated  by  exhibits  of  typewriters,  phonographs,  etc. 

In  addition  to  this,  an  Exposition  offers  an  incentive  to  the 
discovery,  development  and  application  of  new  ideas.  ]\Iany  of  the 
ideas  presented  in  the  Home  Electrical  were  the  direct  result  of 
the  combined  effort  of  the  representatives  of  the  General  Electric 
Company,  not  only  to  surpass  their  competitors,  but  to  accomplish  a 
great  purpose.  This  is  true  of  almost  every  exhibit.  The  Director 
of  the  American  Telephone  and  Telegraph  Company  made  the 
statement  that  the  company  secured  an  appropriation,  and  later 
discovered  the  method  of  transmitting  sound  across  the  continent, 
in  order  to  surprise  the  public  at  the  Exposition,  and  that  if  it 
had  not  been  for  the  Exposition  they  would  not  have  undertaken 
it. 

The  benefit  derived  from  an  exhibit  depends  upon  the  merits 
of  the  idea  presented,  the  efficiency  with  which  it  is  visualized,  and 
the  time  of  its  presentation.  If  the  idea  has  no  merit,  if  it  is  im- 
properly presented,  or  if  it  is  too  far  in  advance  of  the  times, 
or  behind  the  times,  it  will  fall  from  its  own  weakness. 

Social  Economy,  from  an  Exposition  point  of  view,  includes  all 
exhibits  or  visualized  ideas  relating  to  the  development  of  man, 
either  as  an  individual  or  as  a  member  of  a  community.  The  only 
exceptions  to  this  are  exhibits  classified  under  Education,  which 
is  theoretically  a  branch  of  Social  Economy,  but  on  account  of 
the  size  and  complexity  of  its  organization  it  has  been  given  a  sepa- 
rate department. 

Insurance  is  classified  in  the  Department  of  Social  Economy, 
and  is  now  recognized,  not  only  as  an  organization  for  the  collec- 
tion of  funds  from  the  more  fortunate,  to  be  transferred  to  those 
overtaken  by  misfortune  or  calamity,  but  as  a  great  factor  in 
conserving  health,  happiness,  life  and  property.  The  first  insur- 
ance exhibit  was  made  by  the  Prudential  Insurance  Company  of 
America  at  the  Paris  Exposition  in  1900.  They  again  made  an 
extensive  exhibit  at  the  St.  Louis  Exposition  in  1904  on  "The 
Theory  of  Insurance."  The  Modern  Woodmen  of  America  had 
a  small  exhibit  of  fraternal  insurance,  and  the  German  Government 
exhibited  its  system  of  compulsory  insurance. 

At  the  Panama-Pacific  International  Exposition  the  Prudential 
is  teaching  the  public  lessons  in  insurance  methods,  insurance  his- 
tory and  public  health.  The  Mtna  presents  the  subject  of  safety 
devices,  and  the  IMetropolitan  is  showing  its  nursing  service  and 
welfare  work.  The  Rossia,  Maryland  Casualty,  and  Hartford  Fire 
are  also  represented,  and  the  Insurance  Field  has  made  a  collec- 
tive exhibit.  Altogether  there  are  three  hundred  and  twenty-five 
insurance  exhibits.  This  represents  a  colossal  effort  to  educate 
the  public  on  insurance  activities,  and  to  create  a  friendly  feeling 
toward  the  insurance  business. 

Inexperienced  exhibitors  make  many  mistakes,  and  the  expe- 
rienced ones  can  usually  discover  means  of  making  improvements. 


148       WORLD'S  INSURANCE  CONGRESS 

Some  of  these  exhibits,  however,  are  95  per  cent  efficient,  and 
others  are  only  5  per  cent. 

The  methods  of  secrecy  formerly  employed  by  large  corporations, 
and  the  attitude  of  the  "public  be  damned,"  is  now  obsolete.  The 
future  of  all  large  business  firms  in  this  country  depends  upon 
openness,  frankness,  and  publicity.  The  support  of  the  general 
public  is  necessary,  and  that  support  cannot  be  aroused  unless 
the  public  is  first  made  familiar  with  the  principles  involved. 
The  most  effective  way  of  enlightening  the  public  is  through 
exhibits. 

International  Expositions  occur  about  every  eleven  years.  In 
the  meantime  there  are  always  a  number  of  special  expositions, 
such  as  those  conducted  in  connection  with  congresses  and  con- 
ventions, associations,  state  and  county  fairs. 

I  have  long  advocated  a  permanent  Museum  of  Social  Economy, 
which  shall  occupy  a  suitable  building,  a  part  of  which  shall  be 
devoted  to  research  and  to  the  collection  of  the  results  of  research 
throughout  the  world.  Another  part  shall  be  used  as  a  work- 
shop, wherein  shall  be  created  exhibits  visualizing  the  ideas  selected 
from  the  research  department.  Third,  a  shipping  room,  for  the 
purpose  of  housing  and  handling  these  exhibits,  which  will  be 
sent  to  all  parts  of  the  country,  and  to  local  fairs  and  exposi- 
tions, as  traveling  exhibits.  Fourth,  a  museum,  wherein  these 
exhibits  will  be  arranged  for  the  study  of  visitors.  Fifth,  a 
laboratory,  for  the  testing  of  materials  furnished  by  the  public 
or  by  inspectors,  similar  to  that  maintained  by  the  Board  of  Fire 
Underwriters. 

Mr.  Forrest  F.  Dryden,  President  of  the  Prudential  Insurance 
Company  of  America,  has  foreseen  the  necessity  of  such  a  move- 
ment for  the  benefit  of  the  insurance  business  and  the  public  at 
large.  The  following  is  a  paragraph  from  a  letter  written  at  the 
suggestion  of  the  World's  Insurance  Congress: 

"The  World's  Insurance  Congress  could  consider  the  practica- 
bility of  establishing  a  national  institute  for  insurance  science,  in 
which  all  branches  of  insurance  should  be  presented  for  the  infor- 
mation and  instruction  of  the  public  as  an  aid  towards  a  better 
understanding  of  the  elementary  facts  of  insurance  experience  and 
a  guide  in  the  framing  of  wise  legislation  for  the  supervision  and 
control  of  a  business  which,  in  recent  years,  has  assumed  very 
large  proportons.  Such  an  institute,  as  implied  in  the  foregoing 
suggestion,  should  also  include  an  insurance  museum  for  the  col- 
lection and  preservation  of  insurance  literature,  insurance  experi- 
ence, and  the  documentary  methods  and  means  by  wliich  the  busi- 
ness has  been  carried  on  in  the  past,  and  is  being  carried  on  at 
the  present  time.  This  plan  would  tend  measurably  to  advance 
the  dignity  of  insurance  as  a  social  institution,  and  make  manifest 
in  the  most  convenient  form  the  services  rendered  by  sound  in- 
surance in  all  its  branches  to  governmental,  associated,  or  indi- 
vidual efforts  to  make  the  world  a  bettor  place  to  live  in,  by  elim- 
inating the  risks  of  the  individual  life.     Sucli  an  institute  would 


WORLD'S  INSURANCE  CONGRESS  149 

also  serve  as  a  means  of  welding  together  all  of  the  numerous  and 
at  present  widely  separated  insurance  interests  into  one  vast 
national  and  even  international  organization  for  the  development 
and  conservation  of  insurance  as  a  science  and  an  art,  making 
effectively  and  progressively  for  human  betterment. ' ' 

The  President  of  the  Prudential  gave  expression  here  to  a  pro- 
found truth.  The  good  will  and  support  of  the  general  public 
is  essential  for  the  broad  future  development  of  insurance  in  all 
its  branches.  Such  an  institution  is  required  for  the  purpose  of 
securing  this  good  will  by  presenting  insurance  knowledge  accu- 
rately, systematically,  and  in  a  form  which  is  both  interesting 
and  attractive.  The  results  of  such  work  will  be  of  great  benefit 
to  the  insurance  profession,  the  insurance  business  and  to  the 
public  at  large. 

I  recommend  that  the  World's  Insurance  Congress  pass  a  reso- 
lution strongl}'  endorsing  the  establishment  of  a  national  institute 
for  insurance  science,  as  herein  outlined. 


OPENING  ADDRESS  OF  THE  SPECIAL  CHAIRMAN 

WiLLARD  Done 
Former  Insurance  Commissioner  of  Utah 

Ladies  and  Gentlemen :  I  feel  it  is  the  province  of  the  Special 
Chairman  to  preside  and  not  to  speak,  but  I  pray  your  indul- 
gence for  about  three  minutes,  because  I  think  that  it  is  due  to 
you,  myself,  and  the  world,  that  I  say  a  word  or  two  about  this 
great  movement  and  what  it  means  to  us  who  are  in  the  insurance 
business.  We  are  here  for  the  purpose  of  discussing  the  matter 
of  associations  of  insurance,  which  are  properly  termed  the  uni- 
versities of  the  insurance  field. 

I  like  the  word  university  as  applied  to  these  insurance  asso- 
ciations. It  carries  out  the  idea  of  cooperation  for  education  and 
enlightenment.  A  university  is  a  combination  of  educational 
units,  brought  together  under  one  directing  head  for  a  common 
purpose.  In  this  sense,  the  World's  Insurance  Congress  may  be 
called  a  university,  deserving  the  appellation  because  it  is  made 
up  of  affiliated  units,  and  because  it  is  universal  in  scope.  It  is 
the  first  organization  of  its  kind,  world  wide  in  plan  and  purpose, 
pregnant  with  untold  possibilities,  and,  I  trust,  destined  to  be 
permanent. 

There  have  been  set  forth  in  this  Congress,  much  better  than 
I  can  hope  to  state  them,  reasons  why  these  insurance  colleges,  as 
they  may  well  be  called,  should  be  continued,  and  if  possible  com- 
bined into  a  great  insurance  university.  One  reason  appeals  to  me 
as  conclusive.    It  is  the  necessity  of  convincing  the  rank  and  file 


150  WORLD'S  INSURANCE  CONGRESS 

of  insurance  men  of  the  great  social  service  they  render,  so  that 
they  may  the  more  effectively  impress  this  truth  on  others.  In 
many  instances  the  beam  must  be  removed  from  their  eyes,  that 
the}'  may  the  more  clearly  see  to  take  the  mote  from  the  public 
eye. 

The  clarity  of  vision,  the  breadth  of  conception,  the  unity  of 
purpose,  the  loftiness  of  aim  of  our  business  and  those  engaged 
in  it,  will  thus  become  common  property  of  insurer  and  insured. 

Avoiding  the  extreme  claim  of  mere  commercialism  on  the 
one  hand  and  pure  philanthropy  on  the  other,  and  recognizing 
the  place  of  insurance  in  both  these  fields,  we  may  the  more  con- 
fidently ask  our  clients  to  cooperate  with  us  through  these  construc- 
tive associations,  in  removing  prejudice,  lessening  exactions,  broad- 
ening service,  defeating  obstructive  and  promoting  constructive 
legislation. 

By  this  cooperation  among  ourselves  and  with  the  public,  we 
shall  make  notable  progress  toward  the  goal  of  brotherhood,  en- 
lightenment, and  peace  so  eloquently  portrayed  by  Mr.  Kingsley 
in  his  masterly  address. 

With  this  brief  statement  on  my  part,  I  will  now  proceed  to 
the  business  of  the  day.  "Associations:  The  Insurance  Univer- 
sities." The  statement  in  the  program  is  "Associations  represent 
the  natural  avenues  through  which  the  public  must  be  educated  in 
the  constructive  influence  of  insurance  as  developed  during  the 
proceedings  of  the  second  day  of  the  Congress,  and  therefore  find 
their  logical  place  in  the  program  of  the  third  day."  What  each 
speaker  is  expected  to  do  is  also  set  forth :  ' '  relate  the  part  that 
the  association  with  Avhich  he  is  identified  plays  in  the  ethics  and 
economics  of  insurance,  and  to  outline  how  its  usefulness  may  best 
be  extended  so  as  to  bring  about  an  understanding  of  insurance 
and  its  service  among  the  greatest  number  of  people,  to  the  end 
that  there  will  be  fewer  burdensome  restrictions,  a  reduction  of 
expenses  and  losses,  lower  costs  to  the  consumer,  and  a  wider  dis- 
tribution of  insurance  benefits  to  the  people  at  large."  I  know 
the  speakers  are  well  qualified  to  present  in  proper  form  the 
forces  of  their  association  movements,  which  will  appeal  to  us  all, 
and  convince  us  of  the  rightfulness  of  their  designation  of  ' '  insur- 
iince  universities." 


AMERICAN  LIFE  CONVENTION 

By  Isaac  IMiller  Hamilton 
President,  Federal  Life  Insurance  Company 

Mr.  Chairman,  Ladies  and  Gentlemen:  I  assure  you  it  is  a 
peculiar  pleasure  to  me  to  speak  on  a  day  presided  over  by  Hon- 
orable Willard  Done,  who,  while  Commissioner  of  Insurance  of  the 


WORLD'S  INSURANCE  CONGRESS  151 

State  of  UtaL,  did  so  much  in  constructive  work,  so  much  to  add 
to  the  business  of  insurance  generally,  so  much  to  prevent  im- 
proper practices.  I  hope  it  augurs  well  for  the  deliberations  of 
this,  the  third  day  of  this  World's  Insurance  Congress. 

The  able  gentlemen  to  whom  were  assigned  the  important  duties 
of  organizing  and  conducting  this,  the  first  World's  Insurance 
Congress,  and  of  arranging  a  program  commensurate  with  the 
importance  of  the  Congress,  have  designated  this  as  the  day  of 
Insurance  Associations.  They  very  properly  term  these  Associa- 
tions "The  Insurance  Universities."  Deeming  these  Associations 
the  natural  avenues  through  which  the  public  must  be  educated 
in  the  constructive  influence  of  insurance,  they  have  invited  cer- 
tain speakers  to  appear  before  you,  each  to  relate  the  contribution 
of  his  association  to  the  ethics  and  economics  of  insurance  and 
how  the  usefulness  of  such  association  best  may  be  extended  to 
enlarge  the  understanding  of  Insurance  and  its  service  among  the 
greatest  number  of  people,  so  that  there  may  be  less  restrictions, 
less  expenses  and  losses,  less  cost  to  the  consumer,  and  a  wider 
distribution  of  insurance  benefits  to  the  people  at  large.  The  duty 
of  speaking  in  behalf  of  the  American  Life  Convention  has  been 
assigned  to  me.  It  is  a  pleasant  duty  and  I  shall  endeavor  to 
discharge  it  as  briefly  as  the  importance  of  the  subject  will  allow, 
bearing  carefully  in  mind  the  restrictions  which  the  topic  properly 
imposes  upon  me. 

The  American  Life  Convention  is  an  Association  of  Legal  Re- 
serve Life  Insurance  Companies.  Its  organization  was  considered 
at  a  number  of  conferences  held  in  Chicago,  December  5th,  1905, 
and  upon  the  days  immediately  ensuing,  although  its  organiza- 
tion was  not  completed  formally  until  January  30th,  1906,  at  a 
meeting  held  in  St.  Louis.  Its  organization  was  effected  by  the 
representatives  of  a  few  then  young  and  small  companies,  but  so 
timely  and  so  perfect  was  the  organization  that  it  has  grown  and 
developed  until  it  undoubtedly  is  one  of  the  most  powerful,  if 
indeed  not  the  most  powerful,  influence  for  good  known  to  the 
entire  institution  of  life  insurance. 

The  American  Life  Convention  was  organized  for  the  betterment 
of  conditions  and  the  benefit  of  policyholders.  It  always  has  been 
an  active,  constructive  organization.  Membership  is  by  companies, 
not  by  officials,  and  it  has  several  well  organized,  efficient  bureaus. 
It  meets  annually,  its  meetings  are  open,  the  public  and  press  are 
invited,  and  all  attendants  made  to  feel  they  are  welcome.  Printed 
reports  of  the  meetings  of  the  Convention  and  of  its  bureaus  are 
furnished  gratuitiously  to  life  insurance  companies,  insurance  or- 
ganizations at  home  and  abroad,  public  officials,  libraries,  and 
even  individuals  requesting  them,  as  long  as  the  supply  permits. 
The  Medical  Section  of  the  Convention  now  meets  separately.  Its 
fame  is  such  that  the  ablest  members  of  the  medical  and  surgical 
world  are  glad  to  grace  its  meetings  by  their  presence  and  ad- 
dresses.    Separate  reports  of  its  proceedings  are  printed.     With- 


152       WORLD'S  INSURANCE  CONGRESS 

out  doubt  some  of  the  best  and  most  educational  insurance  litera- 
ture extant  is  contained  in  these  reports  of  the  Convention  and  its 
Medical  Bureau.  The  reports  are  highly  prized  and  requests  for 
them  come  from  far  and  near. 

There  was  a  distinct  need  and  field  for  the  American  Life  Con- 
vention at  the  time  it  was  organized,  and  since,  hence  its  great 
success.  Its  constitution  recites:  "The  American  Life  Conven- 
tion is  organized  for  the  purpose  of  encouraging,  upholding  and 
maintaining  the  business  of  life  insurance;  the  dissemination  of 
information  regarding  the  science  of  life  insurance ;  the  upholding 
of  correct  principles  in  the  conduct  of  the  business  of  life  insur- 
ance ;  the  establishment  and  maintenance  of  confidence  between  the 
management  of  the  companies  composing  the  organization  and 
their  policyholders;  the  correction  of  any  abuses  which  may  arise 
in  the  methods  of  transacting  the  business  of  life  insurance;  the 
promotion  of  cooperation,  acquaintance  and  exchange  of  ideas 
among  the  executive  officers  of  its  membership ;  and  any  and  aU 
other  things  incident  to  the  welfare  of  insurers,  insured  and  the 
public  in  relation  to  the  business." 

Thus  you  will  see  that  at  its  inception  its  organizers  recognized 
the  interests  and  rights  of  the  public  in  all  that  pertains  to  life 
insurance  and  pledged  it  to  "the  dissemination  of  information" 
regarding  it,  a  pledge  it  has  fulfilled  in  greatest  measure  to  the 
manifest  benefit  of  its  members,  their  policyholders,  the  insurance 
fraternity  and  the  public  generall3^ 

The  organization  of  the  American  Life  Convention  was  predi- 
cated upon  the  correctness  of  certain  underlying,  fundamental 
principles,  among  which  were  publicity,  uniform  laws,  strict  State 
supervision,  as  opposed  to  Federal  supervision,  and  the  justice  and 
safety  of  the  Preliminary  Term  method  of  valuation.  At  the 
conference  held  in  Chicago,  December  5th,  1905,  a  resolution  was 
adopted  stating,  "That  we  favor  the  utmost  publicity  in  the  life 
insurance  business;  we  invite  the  closest  supervision  of  honest 
public  officials;  we  favor  such  uniformity  of  laws  in  the  several 
States  as  shall  safeguard  the  interests  of  policyholders,  avoid  abuses 
and  take  the  public  and  policyholders  into  the  confidence  of  the 
management ;  we  believe  that  corrupt  officials  should  be  promptly 
punished;  we  believe  the  searchlight  of  careful,  competent  and 
honest  investigation  has  no  terrors  to  honest  life  companies;  we 
are  opposed  to  any  interference  with  State  supervision  and  control 
of  life  insurance  companies;  we  believe  Federal  supervision  is  not 
expedient,  and  we  believe  it  unconstitutional ;  under  existing  con- 
ditions we  are  opposed  to  it;  we  endorse  strict  State  supervision." 

At  a  later  meeting  it  declared:  "We  believe  the  new  business 
written  each  year  should  pay  the  cost  of  procuring  the  same,  and 
be  no  direct  or  indirect  charge  on  the  old  business  for  either  the 
cost  of  procuring  it  or  for  the  reserve  thereon.  We  therefore 
favor  the  first  year  term  method  of  valuation  both  in  theorj-  and 
practice  and  submit  that  it  is  safe,  sound  and  scientific." 


WORLD'S  INSURANCE  CONGRESS  153 

Since  the  passage  of  these  resolutions  the  Supreme  Court  of 
the  United  States,  by  its  later  decisions,  seems  to  have  made  Fed- 
eral supervision  impossible  (except  it  be  by  constitutional  amend- 
ment, which  appears  undesirable  and  probably  impossible  of  at- 
tainment), thus  vindicating  the  position  of  the  American  Life  Con- 
vention with  reference  to  supervision.  Federal  supervision  means 
dual  supervision  with  consequent  increased  burdens  and  expenses 
which,  in  the  future  as  in  the  past,  will  fall  upon  the  policyhold- 
ers in  the  last  analysis  and  are  not  to  be  considered.  No  way 
has  seemed  open  for  installing  Federal  supervision  and  discard- 
ing State  supervision,  even  if  that  were  admitted  to  be  advisable, 
which  it  is  not.  Many  earnest,  sincere,  capable  men,  devoting 
their  lives  to  the  service  of  life  insurance  and  desiring  its  high- 
est and  greatest  development,  believe  it  would  be  exceedingly  un- 
wise and  possibly  even  calamitous,  to  entrust  the  vast  structure 
of  life  insurance  to  the  regulation  and  supervision  of  one  fallible 
man.  Some  men  might  be  equal  to  the  task,  but  how  many  would 
not  be!  And  yet  this  responsibility  might  fall  upon  the  incom- 
petent or  the  unfaithful.  In  such  case,  who  is  brave  enough  to 
predict  the  havoc,  the  irreparable  havoc,  which  might  be  wrought 
upon  life  insurance  and  its  millions  of  beneficiaries  representing 
the  best  there  is  in  millions  of  American  homes?  The  Legal  De- 
partment of  the  American  Life  Convention  is  believed  to  have 
borne  its  full  share  of  the  responsibility  of  pointing  the  way  for 
these  later  decisions  of  the  Supreme  Court  of  the  United  States. 

State  supervision  so  has  been  developed  under  modern  condi- 
tions, and  the  cooperation  of  the  Insurance  Superintendents  of  the 
various  States  acting  through  their  organization  known  as  the 
Insurance  Commissioners'  Convention,  that  we  practically  have  a 
Federation  of  Supervising  Officials.  They  usually  act  in  conjunc- 
tion and  in  the  interests  of  policyholders.  If  one  should  prove  in- 
competent or  derelict,  the  restraining  influence  and  example  of 
other  worthy  and  capable  Commissioners  probably  would  prove 
sufficient  to  protect  both  policyholder  and  company.  For  its 
courageous  educational  work,  both  among  life  insurance  officials 
and  the  public,  as  to  the  merits  and  demerits  of  State  versus  Fed- 
eral supervision  the  American  Life  Convention  is  to  be  highly 
commended. 

Since  the  passage  of  said  resolutions,  educational  forces  have 
been  at  work  steadily,  and  the  correctness  of  the  Preliminary  Term 
method  of  valuation  now  uniformly  is  admitted.  It  is  recognized 
affirmatively  in  the  statutes  written  upon  the  books  of  many  of 
our  most  important  States,  with  others  yet  to  follow.  Insurance 
experts  generally  now  admit  both  the  justice  and  safety  of  the  plan 
and  none,  or  practically  none,  oppose  its  being  enacted  into 
statutes.  So  in  this  regard,  too,  the  position  of  the  American  Life 
Convention,  as  set  forth  at  its  organization,  is  vindicated. 

The  American  Life  Convention  opposed  a  standard  form  of 
policy  as  being  in  derogation  of  the  right  of  private  contract  and 


154       WORLD'S  INSURANCE  CONGRESS 

certain  to  prevent  improvement  and  development  in  contract  and 
services  offered  by  life  insurance  companies.  In  that  position, 
too,  time  has  shown  the  correct  vision  of  its  organizers. 

The  American  Life  Convention,  although  an  aggressive,  con- 
structive organization,  is  not  a  disturber.  Its  methods  are  those 
of  peace.  It  maintains  a  permanent  office  with  an  efficient  secre- 
tary-counsel in  charge.  Its  other  officers  and  the  members  of  its 
executive  committee,  serve  it  without  pay.  Its  affairs  are  directed, 
when  the  annual  meetings  are  not  in  session,  by  an  executive  com- 
mittee, of  which  the  president,  ex  officio,  is  one.  It  invites  the  co- 
operation of  other  representative  bodies  interested  in  life  insur- 
ance and  gladly  responds  to  similar  invitations  and  requests  from 
them. 

The  American  Life  Convention  now  numbers  ninety-seven  well 
established,  rapidly  growing,  capably  managed,  life  insurance  com- 
panies as  members.  They  are  domiciled  in  thirty-three  different 
states  of  our  Union.  In  each  locality  in  which  these  companies 
are  located,  they  naturally  exercise  a  much  more  potent  influence, 
being  officered  and  managed  bj^  men  well  and  favorably  known, 
locally,  both  as  to  ability  and  integrity,  than  possibly  could  be 
the  case  of  much  older  or  larger  companies,  if  located  at  distant 
points,  though  managed  by  men  of  equal  ability  and  integrity, 
but  where  such  officers  and  managers  were  not  known  and  under- 
stood. 

The  American  Life  Convention  has  no  blot  upon  its  escutcheon ! 
It  always  has  urged  correct  practices  and  condemned  irregulari- 
ties in  the  business  of  life  insurance.  Its  influence  always  has 
been  helpful.  Organized  for  no  improper  motive,  seeking  no  un- 
fair advantages  for  its  members,  it  has  extended  friendly  aid  to 
worthy  companies,  non-members,  and  has  endeavored  to  advance 
the  legitimate  interests  of  all  legal  reserve  life  insurance  compa- 
nies everywhere  for  the  betterment  of  policyholders  and  their  bene- 
ficiaries. It  has  urged  the  repeal  and  opposed  the  passage  of  laws 
inimical  to  policyholders;  it  has  urged  the  passage  of  wise  laws 
and  condemned  unjust  extortions  from  policyholders  under  the 
guise  of  taxes.  Its  members  now  hold  in  trust  for  the  protection 
of  policyholders  and  their  beneficiaries,  $250,000,000.00,  protecting 
to  the  extent  of  $2,000,000,000.00  of  insurance,  2,000,000  provident 
American  homes  and  families. 

The  helpful,  constructive  influence  of  the  American  Life  Con- 
vention is  widely  felt  because  it  is  widely  known.  It  has  held 
annual  conventions  in  widely  separated  portions  of  the  country, 
always  making  new  and  powerful  friends  for  its  members  wherever 
it  has  convened.  Annual  meetings  have  been  held  in  Tennessee, 
Indiana,  Colorado,  Ohio,  Iowa,  Pennsylvania,  Illinois,  Minnesota, 
Texas  and  California.  In  all  of  these  important  States  it  has 
active  members  growing  in  importance  and  influence  that  have 
been  encouraged  and  benefited  by  these  meetings,  their  merits  fre- 
quently being  brought  to  much  fuller  local  recognition  thereby 


WORLD'S  INSURANCE  CONGRESS  155 

than  ever  before,  both  as  to  friendly  competitors  and  the  public. 
Such  in  brief  is  the  organization,  the  past  history  and  the  pres- 
ent status  of  the  American  Life  Convention.  Its  motives  and  meth- 
ods, both  now  well  known  and  understood,  are  commended  on 
every  hand.  AVith  many  other  companies  aspiring  to  become  mem- 
bers as  soon  as  they  shall  have  attained  sufficient  age  and  size,  it 
seems  but  reasonable  to  predict,  based  upon  its  commendable  and 
successful  past,  that  its  future  will  be  an  ever  increasing  benefac- 
tion to  companies,  to  policyholders  and  to  the  public. 


NATIONAL  FRATERNAL  CONGRESS  OF  AMERICA 

By  I.  I.  BoAK 

Member  of  Executive  Committee,  Head  Consul  Pacific  Division, 
Woodmen  of  the  World 

The  National  Fraternal  Congress  of  America,  which  I  have  the 
honor  to  represent  on  this  occasion,  is  a  central  body  of  delegates, 
chosen  by  the  societies  representing  the  fraternal  system  of  life 
insurance,  or  more  accurately  speaking.  Fraternal  Home  Protec- 
tion. It  is  voluntary  in  its  make  up ;  its  functions  are  purely  ad- 
visory and  educational,  its  purpose  being  to  establish  a  somewhat 
informal  code  of  ethics,  looking  to  unity  of  purpose  and  all  that 
pertains  to  proper  progress.  Its  deliberations,  however,  cover  a 
Made  range  of  subjects,  embracing  every  detail  that  enters  into  the 
business,  social  and  fraternal  life  of  the  orders  that  form  the  sys- 
tem. Being,  as  I  have  noted,  purely  advisory  and  instructive  in 
character,  its  legislation  is  not  binding  on  the  delegates  or  the 
societies  they  represent.  In  spite  of  this  absence  of  compulsion, 
or  even  specific  obligation,  the  general  tone  of  its  annual  gatherings 
and  the  measures  that  find  favor  with  the  representatives  are  con- 
structive and  practical,  the  result  being  that  their  adoption  has 
been  successfully  urged  by  the  delegates  before  the  supreme  law 
making  bodies  of  the  many  societies :  Consequently,  the  Fraternal 
Congress  of  America  has,  in  its  twenty  years  of  service,  wielded 
a  mighty  influence  for  good  in  the  fraternal  field  by  standing  stead- 
fastly for  a  higher  standard  of  business  efficiency  and  fraternal 
cooperation. 

Without  attempting  to  quote  insurance  statistics,  I  desire  to 
note  the  fact  that  no  one  form  of  life  insurance  in  operation  any- 
where affects  nearly  as  many  people  as  fraternal  insurance  here 
in  America  does,  and  I  doubt  if  all  the  other  forms  of  insurance 
the  world  over — fire,  life,  accident,  etc. — affect  a  class  of  people 
so  dependent  on  them  or  play  so  great  a  part  in  this  nation's 
economics  as  the  form  that  the  Fraternal  Congress,  through  me, 
represents  here  to-day.  For  while  among  the  seven  millions  of 
fraternal  certificate  holders  in  this  country  are  found  governors, 


156  WORLD'S  INSURANCE  CONGRESS 

mayors,  millionaires  and  captains  of  industry  in  all  legitimate 
lines,  the  rank  and  file  are  composed  of  common  toilers  whose 
wage  is  ofttimes  low  and  employment  uncertain — men  who  find 
the  problem  of  making  both  ends  meet  a  difficult  one  while  alive 
and  in  good  health,  and  whose  death,  but  for  the  protective  arms 
of  the  fraternal  system,  would  mean  absolute  destitution,  with  its 
attendant  miseries. 

The  suggestion,  or  rather  tentative  instruction,  of  the  executive 
committee  found  on  the  program  for  to-day,  in  which  "each 
speaker  is  expected  to  relate  the  part  that  the  association,  with 
w^hich  he  is  associated,  plays  in  the  ethics  and  economics  of  insur- 
ance,"  justifies  me,  I  believe  in  continuing  along  these  lines. 

The  system  of  fraternal  insurance  in  this  country  is  but  a  half 
century  old  and  it  is  but  natural  that  for  many  years  the  few 
struggling  societies  plodded  along  with  fine  purpose,  but  crude 
and  very  uncertain  methods.  Its  necessity,  however,  soon  became 
apparent  and  was  freely  admitted  by  students  and  thinkers,  many 
of  whom  were  and  are  engaged  in  the  promotion  of  other  forms  of 
insurance.  Field  representatives  of  each  form  of  life  insurance 
are  often  heard  to  remark  "What  a  rich  harvest  we  would  reap 
if  the  other  systems  went  out  of  existence."  Now,  I  believe  this 
thought  is,  in  either  case,  about  as  far  wrong  as  it  can  be,  for  I 
have  long  been  convinced  that  no  one  system  of  life  insurance 
w^ould  be  as  strong  as  it  is  to-day  were  it  not  for  the  continued 
activities  of  the  others.  In  order  to  explain  fully,  I  wish  I  might 
be  permitted  at  this  point  to  deviate  slightly  from  the  line  of 
thought  officially  suggested.  Indeed,  I  find  it  hard  to  refrain  from 
doing  so  in  order  to  propound  briefly  what  appeals  to  me  after 
more  than  a  quarter  of  a  century's  observation  and  first  hand 
experience  as  a  mighty  truth,  and  one  that  is  none  too  often 
called  to  the  attention  of  the  general  public.  That  is,  that  insur- 
ance is  the  greatest  educator  of  the  age.  I  realize  this  is  a  think- 
ing body  of  men  and  any  wild  assertion  would  be  challenged ;  so 
I  feel  quite  ready  to  substantiate  my  claim — to  prove  my  assertion. 

No  one  can  dispute  the  self-evident  fact  that  this  is  an  age  of 
advanced  education — this  country — the  United  States  of  America, 
is  the  world's  college,  and  the  events  that  are  now  being  cele- 
brated in  this  city  proclaim  this  year,  1915,  to  be  the  graduation 
period  of  the  ages.  The  theory  on  which  I  base  my  contention  that 
insurance  is  the  greatest  educator  of  the  age  is  this: 

The  wisest  government,  in  the  range  of  human  possibilities,  is 
the  one  which  best  promotes  the  general  welfare  of  the  greatest 
number  of  people.  Surely  then  the  greatest  factor  in  the  education 
of  any  people  is  that  thing  which  cultivates,  develops  and  perfects 
the  greatest  number  of  beneficial  qualities  in  the  masses.  You 
will  note  that  I  am  defining  education  in  its  very  broadest  sense. 
If  our  historical  information  is  correct,  men  wrote  or  made  some 
kinds  of  marks,  that  were  readable  on  the  bark  of  trees,  away 
back  in  the  time  of  Abraham.     In  a  general  way,  that  is  all  wo 


WORLD'S  INSURANCE  CONGRESS  157 

can  do  with  writing  now  and  the  writing  of  some  very  clever  men 
in  the  twentieth  century  is  not  easy  to  read.  Those  old  timers 
knew  enough  of  mathematics  to  figure  out  the  worth  of  their  pos- 
sessions and  to  do  business  as  that  age  required,  I  am  basing  my 
views  on  the  symmetrically  rounding  out  of  men  by  insurance.  I 
mean  by  that,  it  develops  or  helps  to  develop  them  morally,  phy- 
sically, mentally  and  even  religiously.  I  do  not  think  it  necessary 
to  more  than  just  remind  you  of  the  millions  upon  millions  of 
children  who  are  receiving  a  finished  education,  who  would  not 
only  be  deprived  of  that,  but  would  be  forced  into  drudgery  early 
in  life  were  it  not  for  insurance  money  left  by  deceased  fathers. 
I  would  point  out,  briefly,  the  benefits  that  accrue  to  the  insured 
while  he  lives,  based  on  the  three  fundamentals  of  our  Declaration 
of  Independence — life,  liberty  and  happiness. 

That  life  insurance  prolongs  life  has  already  been  stated  in 
brief,  and  will,  during  the  sessions  of  this  Congress,  I  believe,  be 
enlarged  upon  by  competent  speakers.  I  am  wondering,  however, 
if  a  homely  experience,  such  as  was  once  related  to  me,  would 
not  be  worthy  of  mention  as  perhaps  touching  a  phase  of  life-sav- 
ing or  prolonging  life  not  often  noted.  A  member  of  the  society, 
with  which  I  am  identified,  was  given  up  to  die ;  the  doctors  said 
he  must  die  and  he  knew  they  had  said  so.  "But,"  he  said,  "the 
fact  that  if  I  did  die  my  family  would  receive  a  nice  bit  of  insur- 
ance made  me  feel  easy  and  the  next  morning  my  temperature  was 
lower  and  the  doctor  said  I  had  a  chance."  This  took  place  some 
fifteen  years  ago  and  the  member  referred  to  is  now  threatening 
to  outlive  his  expectancy.  His  experience  is  unquestionably  dupli- 
cated in  thousands  of  instances  annually,  for,  permit  me  to  add, 
if  your  family  physician  knows  nothing  of  the  value  of  mental 
contentment  in  reducing  temperature  and  frequently  saving  life, 
you'd  better  get  a  practical  physician,  one  who  does  know  such 
things.  So  altogether,  aside  from  the  physical  requirements  and 
valuable  medical  advices,  invariably  forthcoming  in  connection 
with  examinations  of  applicants,  life  insurance  does  prolong  life. 

Concerning  the  moral,  religious  and  patriotic  development  of 
men  through  the  agency  of  life  insurance,  at  least  as  far  as  the 
insured  themselves  are  concerned,  generous  as  I  feel  in  the  mat- 
ter, I  will  have  to  attribute  about  all  of  the  credit  to  the  system 
I  am  here  to  represent.  The  very  atmosphere  of  the  lodge  room 
teaches  all  who  attend,  something  of  the  brotherhood  of  man,  and, 
seeing  that  no  infidel,  or  any  one  without  some  sort  of  religious 
belief  can  become  a  member  of  any  of  our  fraternities,  the  Father- 
hood of  God  is  certain  to  be  a  part  of  the  lodge  room  teaching. 
The  flag  of  our  country  is  invariably  the  most  honored  decoration 
in  our  meeting  places.  Loyalty  to  our  country  and  its  institutions, 
patriotism  of  the  highest  type,  are  by  example  and  precept  being 
continually  taught,  thereby  instilling  into  the  minds  and  hearts 
of  our  citizens,  both  native  and  naturalized,  the  sacred  truth  that 


158       WORLD'S  INSURANCE  CONGRESS 

God  and  Home  and  Native  Land  are  one  and  inseparable  and 
mean  more  to  men  than  life  itself. 

As  a  nation,  we  boast  of  our  thrift,  and  what  is  there  in  all  the 
world  that  teaches  men  a  greater  lesson  on  thrift  than  the  paying 
of  a  life  insurance  assessment  or  premium?  Not  that  kind  of 
thrift  that  looks  for  bargains,  careless  as  to  who  loses  in  the  trans- 
action— but  thrift  without  a  possibility  of  selfishness,  thrift  robbed 
of  every  suspicion  of  greed,  thrift  in  which  the  heart  promptings 
are  greater  than  those  of  the  brain,  thrift  that  will  speak  volumes 
long  after  the  lips  of  those  who  have  possessed  and  practiced  it 
are  sealed  in  death,  thrift  that  may  well  be  spoken  of  in  the 
w^orld's  work  as  righteous  thrift. 

The  striking  advancements  of  this  age  are  due  not  so  much  to 
the  brilliant  achievements  of  individuals,  as  to  organization — the 
cooperation  of  men.  The  combining  or  centralizing  of  capital  has 
brought  about  many  public  benefits  that  would  otherwise  be  un- 
known to  the  world.  All  insurance  has  the  spirit  of  cooperation. 
The  contributions  of  the  fortunate  many,  make  possible  relief  for 
the  distressed  few.  All  insurance  is  based  on  the  laws  of  substi- 
tution and  replacement.  These  principal  qualities  are  an  educa- 
tion in  themselves;  without  them,  no  people  can  come  even  near 
to  possessing  a  finished  education.  When  a  struggling  farmer 
loses  a  $500  barn  by  fire,  insurance  money  permits  him  to  rebuild 
immediately.  Without  insurance,  he  either  mortgages  his  farm, 
passes  the  hat  or  goes  without  a  barn.  In  either  case,  the  incident 
educates  the  entire  neighborhood  in  which  he  lives.  When  a  woman 
loses  her  husband — when  children  are  left  fatherless — insurance 
money  is  the  substitution  that  makes  it  possible  for  the  family  to 
eat  regularly  and  continue  the  home  relations.  Without  insur- 
ance, the  widow  goes  either  home  to  her  folks  with  mutual  unwill- 
ingness, goes  to  work  or  makes  her  home  with  the  first  scalawag 
that  offers  her  shelter,  while  the  children  do  the  best  they  know 
how,  which  is  often  the  worst  they  could  think  of. 

When  I  was  informed  that  this  Congress  was  to  be  held  here 
in  San  Francisco,  I  said  "AVliat  a  grand  place  to  discuss  all  kinds 
of  insurance;  in  a  city  where  less  than  a  decade  ago  occured  the 
greatest  commercial  disaster  ever  known  on  the  Western  hemis- 
phere ;  a  city  now  numerically  and  financially  stronger  than  before 
that  awful  calamity ;  a  city  that,  but  for  insurance,  would  be  now 
slowly  creeping  from  her  ashes  and  assuming  back-breaking  debts. 
With  what  a  mighty  voice  San  Francisco  has  spoken  to  the  world 
of  insurance!     What  an  education  for  all  time!" 

You  will  readily  see  that  time  will  permit  me  to  do  but  little 
more  than  outline  my  subject.  In  regard  to  suggestions,  anent  the 
lowering  of  costs,  lessening  of  losses,  reducing  restrictions  and 
causing  insurance  to  be  better  understood,  I  have  just  one  theory 
to  advance — a  theory  that  is  as  simple  and  sure  of  results  as  the 
darkey's  definition  of  the  chief  effects  of  possum  and  sweet  potatoes 
on  the  culled  system — a  desire  for  more  possum   and  sweet  pn- 


WORLD'S  INSURANCE  CONGRESS  159 

tatoes.  I  suggest  more  insurance — more  education.  I  feel  that  the 
details  of  expense,  medical  examinations  and  the  multitude  of 
minor  things  that  contribute  to  the  success  of  insurance,  are  being 
worked  out  very  satisfactorily  in  the  system  I  am  here  to  repre- 
sent. This  Congress,  whose  prolonged  deliberations  will  be  given 
wide-spread  publicity,  will  result  in  great  good  to  the  insurance 
world.  I  wish  insurance  were  universal.  When  I  see  some  big, 
lazy  fellow  insure  his  property  and  refuse  to  insure  his  life,  I  feel 
like  advocating  compulsory  insurance.  Then  I  think  what  a  de- 
cided slam  that  would  be  to  American  intelligence  and  sentiment. 
The  man  without  sentiment  is  a  good  deal  like  a  man  without  a 
soul.  The  fellow  who  assumes  that  his  responsibilities  end  with 
his  breath,  puts  himself  on  a  plane  with  the  horse.  The  worst 
humbug  of  all,  and  the  one  that  I  would  like  to  find  a  way  to 
banish  utterly  from  the  land,  is  the  religious  freak  who  preaches 
that  insurance  shows  a  distrust  in  Almighty  God.  He  never  puts 
such  a  theory  into  practice  while  he  lives.  He  protects  his  body 
against  the  elements  with  warm  clothes;  he  prepares  for  winter 
and  other  seasons  just  as  if  he  knew  nothing  about  God ;  he  never 
expects  to  reap  anything  unless  he  has  sown  the  seeds,  but  he 
claims  that  God  will  be  a  make-shift  for  his  laziness  or  neglect  after 
he  has  gone  from  the  earth.    This  is  plain  sacrilege. 

Now,  Gentlemen,  I  have  not  attempted  to  be  profound;  I  have 
tried  to  point  out  some  things  about  insurance  that  are  not  given 
any  too  much  publicity,  nor  are  they  any  too  well  understood  by 
the  insured  public,  and  it  is  through  the  public  and  its  influence 
that  we  must  expand. 

In  conclusion,  let  me  predict  a  nation-wide  awakening  for  in- 
surance of  all  forms.  The  logic  of  cooperation,  as  a  means  to  in- 
dividual protection,  is  gaining  ground  every  day  and  I  firmly  be- 
lieve and  earnestly  hope  that  universal  insurance,  without  legisla- 
tive compulsion,  will  soon  be  a  reality.  I  have  only  been  able,  in 
this  brief  space  of  time,  to  skeletonize  my  subject.  Insurance,  in 
its  broadest  sense,  reaching  as  it  does  into  every  activity  of  life, 
has  naturally  attracted  many  men  of  many  minds  and  it  is  well 
that  this  is  so,  for  it  has  resulted  in  the  formation  of  various  sys- 
tems, each  one  peculiarly  suited  to  some  specific  human  need. 
Little  wonder  then,  that  it  has  taught  the  whole  world  a  new  stand- 
ard of  economics ;  it  has  appealed  to  all  classes  as  an  exhibition  of 
many  styles  to  suit  many  tastes,  as  a  construction  of  many  roads 
to  the  one  destination,  as  a  combination  of  rare  colors,  developing 
into  one  harmonious  whole.  It  stands  before  us  in  its  construction 
and  operation  as  a  unique  and  valuable  instructor ;  in  results,  as  a 
universal  benefactor,  and  in  all,  a  world-wide  educator. 

No  human  tongue  can  ever  tell,  nor  pen  can  ever  write,  a  com- 
plete history  of  the  value  of  the  fraternal  system  of  life  insurance. 
Covered  by  a  less  number  of  years  than  many  of  us  present  have 
lived,  the  fraternal  societies  have  paid  the  beneficiaries  of  deceased 
members  the  enormous  sum  of  $1,096,933,582.     At  the  opening  of 


160  WORLD'S  INSURANCE  CONGRESS 

this  year,  the  protection  in  force  was  $7,302,847,221.  The  statistics 
of  a  scattering  few  societies  are  not  included  in  these  figures.  Far 
greater  than  all  these  figures,  however,  is  the  uncountable  and  in- 
estimable spirit  of  fraternity  that  has,  in  a  large  measure,  become 
the  modem  exemplifier  of  the  great  truth  that  "No  man  liveth  to 
himself,  but  every  one  of  us  is,  in  some  measure,  his  brother's 
keeper."  No  figures  are,  or  can  be  compiled,  to  total  this  priceless 
asset  of  fraternal  protection ;  no  earthly  record  is,  or  can  be  kept 
of  the  kindly,  helping  hand,  the  cheering  words,  the  members  kept 
in  good  standing  when  prolonged  sickness  has  depleted  their  re- 
sources, the  multitude  of  little  kindnesses  showered  on  the  dark- 
ened home  when  the  grim  reaper  has  touched,  with  his  icy  hand, 
the  breadwinner  of  the  household.  All  of  this  forms  part  of  what 
we  call  fraternal  insurance,  but  I  feel  sure  that,  in  the  realm  where 
these  things  are  recorded,  they  must  be  set  down  as  Christian 
Berievolence. 


NATIONAL   ASSOCIATION   OF   INSURANCE   AGENTS 

By  C.  H.  Woodworth 
Former  President 

Mr.  Chairman,  Ladies  and  Gentlemen :  Yesterday  and  the  day 
before,  while  listening  to  the  eloquent  addresses  on  the  subject  of 
insurance,  and  regarding  its  separate  branches,  my  mind  ranged 
over  my  fifty  years  of  experience  in  insurance,  and  so  you  would 
not  be  surprised  if  I  attempted  to  make  some  comment  on  what 
has  been  said,  and  add,  possibly,  some  contribution  to  Avhat  has 
been  said  but  the  unity  of  the  program  very  properly  confines  me 
to  the  aims,  accomplishments  and  services  of  the  association  which 
I  have  the  honor  to  represent,  and  I  will  therefore  confine  myself 
strictly  to  the  topic,  as  every  good  servant  of  the  Program  Com- 
mittee should  do.  And  may  I  ask  you,  in  listening  to  this  dry, 
brief  paper,  to  bear  in  mind  that  I  represent  a  body  of  men  who 
are  in  personal  touch  with  the  people  of  this  country  and  are  at 
the  foundation  of  the  insurance  structure.  And  when  I  say  per- 
sonal touch,  I  don't  mean  the  spell-binder  from  the  platform,  but 
I  mean  the  individual  hand  to  hand  touch  with  the  men  who  in- 
sure and  who  ought  to  insure.  That  is  where  we  stand— with  our 
ears  to  the  ground  listening  to  public  sentiment  and  appreciating, 
perhaps,  as  no  other  body  of  men  in  the  insurance  business,  the 
state  of  the  public  mind  and  what  should  be  done  and  said  for  its 
enlightenment  and  the  enlightenment  of  those  who  are  in  tliis 
position. 

The  causes  that  inspired  the  organization  of  the  National  Asso- 
ciation of  Insurance  Agents  and  the  general  demand  among  local 
agents  twenty  years  ago  for  such  an  association,  will  be  better 


WORLD'S  INSURANCE  CONGRESS  161 

understood  and  appreciated  if  we  briefly  consider  the  earlier  days 
of  the  Insurance  Agency  business. 

In  the  days  of  stoves,  candles,  small  buildings  and  low  speed, 
hazards  were  simple  and  nearly  uniform.  Everything  from  the 
brick  dwelling  to  the  small  factory  was  written  at  about  the  same 
rate  and  form.  The  agent,  far  removed  from  the  home  office,  with 
communication  slow  and  difficult,  was  chosen  not  because  he  was 
a  business  getter — for  in  those  days  companies  did  not  actively 
seek  business,  and  owners  sought  protection — but  because  he  was 
an  honest  and  intelligent  man,  willing  to  give  part  of  his  time  to 
insurance.  A  local  representative  was  desired  with  some  general 
knowledge  of  physical  conditions  and  moral  hazards;  one  who 
would  pass  upon  and  accept  or  decline  business  offered  accord- 
ing to  his  best  judgment  and  who  would  also  settle  the  losses  as 
they  occurred.  There  were  no  maps  or  surveys  and  the  agent 
reported  but  once  a  month  when  his  account  current  included 
the  written  forms  of  all  policies  issued.  There  was  no  one  between 
the  agent  and  his  company  and  but  little  correspondence. 

New  and  changing  hazards  developed  by  big  and  always  bigger 
business — the  use  of  volatile  and  inflammable  products,  the  greater 
area  of  factories,  equipped  with  high  speed  machinery  and  oper- 
ated with  high  pressure  methods,  the  congestion  in  manufacturing 
and  mercantile  sections  and  the  ever  increasing  competition  be- 
tween companies  for  premiums,  radically  changed  the  fire  insur- 
ance business.  With  new  conditions  andL  methods  came  more  and 
different  requirements  of  the  local  agent  and  prompter,  and  closer 
supervision  of  his  work  by  the  company.  In  addition  to  the  special 
agent  there  were  often  between  the  agent  and  his  company  a  State 
or  general  agent.  Then  there  were  National  and  Sectional  Asso- 
ciations of  Companies,  of  General  Agents  and  of  Special  Agents, 
which  further  interfered  with  direct  communication  between  agent 
and  company. 

While  these  changes  were  for  the  development  and  betterment 
of  the  business  and  of  assistance  to  the  agent,  greater  pressure  was 
exerted  by  the  individual  company,  upon  all  its  force,  for  a  larger 
premium  account.  It  was  therefore  natural,  when  promotion,  if 
not  position,  depended  upon  increasing  the  company's  business, 
that  its  salaried  employees  should  at  times  adopt  methods  and  in- 
dulge in  practices  inimical  to  local  agents  working  on  a  commis- 
sion. Not  all  the  companies  practiced  or  countenanced  injustice 
to  agents,  but  there  were  enough  doing  so  to  produce  unsatisfactory 
conditions.  The  individual  local  agent,  practically  shut  off  from 
the  ear  of  his  home  office,  required  the  support  of  his  fellow  agents 
and  the  National  Association  was  conceived  to  suppl^y  that  need. 

The  meeting  for  organization  of  the  National  Association  of 
Insurance  Agents  was  held  in  Chicago  in  September,  1896. 
The  constitution  then  adopted  was  revised  and  a  declaration  of 
principles  made  at  the  second  meeting  held  in  St.  Louis  the  follow- 
ing May.     Only  Fire  Insurance  agents  were  eligible  to  member- 


162       WORLD'S  INSURANCE  CONGRESS 

ship  in  the  association  up  to  1913.  At  that  time  the  name  and 
constitution  were  amended  admitting  casualty  and  surety  agents. 
The  National  Association  of  Insurance  Agents  like  other  trade 
Associations  was  organized  primarily  for  the  benefit  of  its  mem- 
bers, but  very  early  it  was  recognized  that  in  the  final  analysis  the 
real  interests  of  the  Agent  were  identical  with  the  real  interests 
of  both  companies  and  insurers;  hence  the  statement  of  its  ob- 
ject, viz.:  "To  support  right  principles  and  to  oppose  bad  prac- 
tices in  Fire  Underwriting."  Operating  upon  this  basis  the  Na- 
tional and  State  Associations  have  prospered  these  twenty  years 
beyond  the  expectation  of  the  most  optimistic.  They  have  become 
prominent  factors  in  the  business,  and  of  financial,  ethical  and 
educational  value  to  the  country. 

What  has  been  accomplished  by  the  National  Association  of 
Insurance  Agents,  its  present  and  growing  power  and  the  gen- 
eral approval  of  its  legislation  and  declarations,  are  evidence  that 
in  its  management,  wisdom  and  right  have  gone  hand  in  hand. 
Every  measure  adopted  and  every  advantage  secured  have  been 
of  equal  benefit  to  ever,y  local  agent  in  the  business,  whether  a 
member  of  the  Association  or  not.  The  only  special  privileges 
enjoyed  by  our  membership  are  educational  and  altruistic. 

One  of  the  most  notable  early  achievements  of  the  Association 
was  the  obtaining  of  an  agreement  with  the  companies  to  discon- 
tinue overhead  writing.  The  value  of  this  to  local  agents  is  ob- 
vious. Its  value  to  property-owners  and  companies,  although  less 
direct,  is  important. 

A  far-reaching  decision  to  all  concerned  was  that  securing  to 
the  agent  a  property  right  in  his  business,  thus  making  the  agent's 
life  work  a  tangible  asset. 

The  Association  has  invariably  and  energetically  opposed  local 
rate  wars,  and  such  vicious  warfare,  from  which  innocent  third 
parties  suffer  the  most,  has  practically  ceased. 

The  liberal  expenditure  of  time  and  money  made  by  the  Asso- 
ciation in  introducing  uniform  blanks  is  now  bearing  fruit. 

The  National  Association  of  Insurance  Agents  has  not  legis- 
lated upon  fire  insurance  rates  or  upon  agents'  commissions,  ex- 
cept to  urge  anti-discrimination  and  uniformit3'. 

The  purpose  of  this  paper  does  not  require  reference  to  other 
refoi-ms  and  benefits  secured  through  the  efforts  of  the  Associ- 
ation. 

The  direct  educational  power  of  our  Asociation  is  suggested  by 
the  nature  of  the  local  agent's  business.  His  acquaintance  with  all 
classes  of  men,  and  the  knowledge  he  has  of  all  kinds  of  business, 
are  a  liberal  education  to  him ;  and  his  personal  association  with 
the  people  of  his  locality  gives  him  the  opportunity  to  impress 
upon  the  community  not  only  the  necessity  for  fire  insurance  but 
the  rights  and  duties  of  those  furnishing  it.  Agents  are  better 
prepared  to  give  this  service  by  the  literature  furnished  them  by 
our  Association,  through  our  official  organ,  the  American  Agency 


WORLD'S  INSURANCE  CONGRESS  163 

Bidletin,  and  by  attendance  at  our  State  and  National  Conven- 
tions. Hundreds  of  men  who  have  come  up  to  these  Conventions 
with  axes  to  grind  have  caught  the  genius  of  our  organization  and 
have  gone  home  to  turn  grindstones  for  the  benefit  of  all. 

All  agents,  because  of  our  organization,  are  better  qualified  to 
conduct  their  business  and  they  appreciate  more  fully  their  duties 
to  the  public  as  well  as  to  their  companies.  The  educational  value 
of  our  Association  to  others  engaged  in  the  business  has  been  to 
help  them  to  a  better  knowledge  of  public  sentiment  regarding 
Fire  Insurance  and  to  a  more  judicious  attitude  towards  the  hos- 
pitality of  legislators  and  others  in  authority. 

The  value  of  the  Association  to  the  public  is  emphasized  in  our 
Fire  Prevention  "Work.  Fire  Prevention  is  as  old  as  insurance 
itself.  It  began  with  the  first  inspection  made  by  the  first  agent. 
The  Association  is  a  supporter  of  the  National  Credit  Men's  Asso- 
ciation, the  National  Fire  Prevention  Association  and  other  similar 
bodies.  Not  much  more  valuable  than  this  organized  work  is  the 
influence  of  the  individual  agent  upon  the  individual  property- 
owner,  in  securing  the  removal  of  existing  perils  and  the  installa- 
tion of  better  protection.  Valuable  service  is  rendered  by  the  local 
agent  in  urging  these  matters  upon  municipal  and  state  legisla- 
tors. The  association  has  from  the  first  approved  fire  marshal  laws 
and  through  its  membership  has  helped  to  secure  their  passage 
in  many  states. 

Only  about  five  per  cent,  of  the  more  than  $$22,000,000  collected 
by  States  and  municipalities  from  insurance  companies  in  taxes 
is  used  for  supporting  insurance  departments.  The  association 
has  protested  emphatically  against  this  injustice  because  exces- 
sive taxation  increases  rates  which  incite  unfair  criticism  of  the 
business.  The  resolution  adopted  at  our  Atlanta  Convention  in 
1912  on  this  subject  was  the  first  official  effort  of  any  organization 
to  bring  about  a  federation  of  all  insurance  interests  to  act  upon 
this  and  other  questions  affecting  all  branches  of  insurance. 

The  opposition  of  our  association  to  "Underwriters'  Agencies" 
is  not  only  because  in  effect  their  method  is  the  operation  of  two 
companies  on  one  capital  and  is  therefore  unfair  to  those  com- 
panies that  do  not  maintain  such  feeders,  but  because  they  deceive 
the  public  and  tend  to  monopoly  in  the  business. 

Legislation  requiring  certain  qualifications  for  agents,  which 
we  favor,  protects  the  public  from  ignorance  and  crookedness. 
The  association  in  the  interest  of  the  property  owner  and  all 
others,  stands  for  the  enactment  of  anti-rebate  and  anti-discrimi- 
nation laws  already  adopted  by  many  states.  The  association 
favors  the  repeal  of  valued-policy,  anti-compact  and  anti-co-in- 
surance laws,  all  of  which  increase  the  cost  of  insurance ;  and  it 
has  always  supported  State  insurance  officials  in  their  efforts  to 
protect  property  owners  against  the  depredations  of  wild  cat  com- 
panies. The  invaluable  service  of  our  members,  who  have  the 
voter's  ears  and  confidence,  in  disseminating  information  relat- 


164       WORLD'S  INSURANCE  CONGRESS 

ing  to  insurance,  has  helped  to  secure  in  many  states  more  intelli- 
gent and  reasonal)lc  legislation. 

This  brief  statement  regarding  the  organization,  work  and  aims 
of  the  National  Association  of  Insurance  Agents  is  evidence  of  its 
tangible  accomplishments  and  is  sufficient  to  indicate  the  reasons 
for  its  existence.  It  has  often  been  thought  too  radical  by  com- 
panies and  too  conservative  by  agents,  but  time  has  proven  that 
its  action  was  wise.  The  preventive  and  cooperative  work  of  the 
Association  has  perhaps  been  of  more  value  than  its  constructive 
measures,  our  policy  being  to  take  the  initiative  only  when  neces- 
sary. At  present  we  are  particularly  interested  in  Fire  Preven- 
tion, Equitable  Rating,  Better  Agents,  Reduced  Expenses  and 
Supervisory  as  opposed  to  Destructive  or  Prohibitory  Legislation. 
In  the  future  as  in  the  past  we  shall  endeavor  to  meet  every  change, 
whether  evolutionary  or  artificial,  with  open  minds  and  wise  ac- 
tion, supporting  all  that  improves  and  opposing  all  that  injures  the 
business. 

We  are  bound  to  no  special  interest  and  will  not  cooperate 
in  any  movement  that  does  not  recognize  that  both  companies  and 
their  agents  are  entitled  to  existence  and  fair  treatment ;  nor  will 
we  support  any  action  in  connection  with  the  business  that  is  un- 
just to  property  owners.  We  hold  Fire  Insurance  to  be  an  eco- 
nomic necessity  which  should  be  conducted  equitably  and  con- 
trolled fairly. 


NATIONAL   ASSOCIATION  OF   LIFE   UNDERWRITERS 

By  H.  H.  Ward 
Former  President 

According  to  Mr.  Done,  the  life  insurance  men  of  the  old  days 
must  have  been  some  Indians.  I  came  down  here  to  attend  every 
session  of  this  Convention,  and  hear  every  speech,  and  I  am  not 
going  to  tell  you  how  I  met  with  my  accident,  but  it  is  my  reason 
for  not  being  here  constantly.  I  did  consider  it  my  duty,  though, 
to  honor  that  noble  fellow  Hathaway  by  using  my  utmost  endeav- 
ors to  be  here  to-day. 

The  World's  Insurance  Congi-ess  program  for  the  third  day  very 
aptly  refers  to  "Associations"  as  "The  Insurance  Universities." 
The  particular  college  of  this  great  insurance  university  which 
has  been  assigned  to  me  for  discussion  is  the  "National  Associa- 
tion of  Life  Underwriters,"  the  first  national  "get-together-club" 
ever  organized  by  any  branch  of  life  insurance.  The  deep,  under- 
lying principle  of  the  National  Association  of  Life  Underwriters 
is  that  no  man  is  as  great  as  his  company:  no  company  is  as  great 
as  life  insura.nce.  Therefore,  in  the  development  and  growth  of 
this  association,  the  agent  and  the  company  are  placed  respectively 


WORLD'S  INSURANCE  CONGRESS  165 

in  third  and  second  places,  while  life  inmrancc  as  an  institution 
holds  first  place.  Life  insurance  as  an  institution,  has  for  its  end 
and  object  the  protection  of  the  insured  in  particular  and  of  soci- 
ety in  general,  the  company  and  the  agent  being  merely  means 
to  that  end. 

Life  insurance  has  developed  by  leaps  and  bounds  until  to-day 
it  is  the  second  largest  business  in  existence,  being  exceeded  only 
by  steam  railroads,  and  millions  of  the  securities  of  steam  railroads 
lie  in  the  vaults  of  the  life  insurance  companies'  home  offices. 
There  is  a  reason  for  the  life  insurance  business  being  the  second 
largest  in  the  world.  It  fulfills  a  need  of  mankind  which  no  other 
institution  ever  did,  or  ever  will  fulfill.  The  history  of  its  devel- 
opment and  gi'owth  is  most  interesting.  The  part  which  the  agent 
has  played  in  that  development  and  growth  is  by  no  means  the 
least  part. 

Modem  life  insurance  on  the  Old  Line  or  Legal  Reserve  plan 
has  been  surrounded  and  safegl^arded  by  Nature's  great  law  of 
averages  in  mortality  as  applied  to  large  groups  of  men  by  the 
mathematical  principle  of  average.  So  great  is  this  law  and  so 
well  balanced  is  the  application  to  the  business  that  there  is  no 
other  commercial  enterprise  which  can  be  so  accurately  prognosti- 
cated as  to  its  future.  The  very  fact  that  life  insurance  has  this 
safeguard  is  in  part  responsible  for  its  wonderful  growth.  The 
system  itself  now  has  the  confidence  of  the  world. 

The  story  of  the  agent  in  the  field,  the  man  with  the  rate  book, 
is,  however,  a  very  different  one  from  the  orderly  and  constructive 
story  of  the  mathematical  or  actuarial  side  of  life  insurance.  Life 
insurance  to-day  is  what  it  is  because  of  the  agent  in  the  field  who 
wrote  the  business  and  it  is  what  it  is  in  spite  of  the  agent  in  the 
field.  In  days  past,  the  unscientific,  unbusinesslike  and,  sometimes, 
unscrupulous  agent  has  been  his  own  worst  enemy,  and  as  such  has 
been,  under  the  old  methods,  one  of  the  destructive  elements  in  the 
business. 

The  TRUTH  is  the  very  best  that  can  be  told  of  life  insurance. 
The  truth  has  never  injured  life  insurance.  It  is  the  falsehoods, 
told  through  ignorance  or  with  intent  to  deceive,  which  have  been 
in  the  past,  the  greatest  drawback  to  the  development  of  life  in- 
surance along  proper  lines,  resulting  in  much  of  the  disbelief  which 
has  existed  concerning  the  business. 

I  have  said  that  the  agent  in  the  old  days  and  under  the  old 
methods  was  often  his  own  worst  enemy.  He  was  egged  on  by 
old  home  office  methods  which  demanded  increased  production  of 
insurance  to  a  point  where  he  almost  felt  that  his  very  existence 
consisted  in  his  ability  to  build  up  his  agency,  or  his  company, 
on  the  ruins  of  other  agencies  and  other  companies.  The  over- 
head cost  to  the  agent,  agencies  and  companies  by  this  method  of 
procedure  became  ruinous;  it  became  prohibitive.  Strange  to  say, 
it  was  not  the  home  office  which  first  discovered  this  fact.  It  was 
the  agent  in  the  field. 


166       WORLD'S  INSURANCE  CONGRESS 

Some  forty-five  years  ago  a  Dreamer  dreamed  a  dream.  He  was 
in  the  midst  of  conditions  then  existent,  and  his  Vision  carried  his 
years  into  the  future.  He  saw  the  possibilities  there  were  for 
American  life  insurance.  He  probably  saw  that  the  company  and 
the  agent,  who  in  those  days  seemed  to  think  that  they  were  the 
whole  thing  in  life  insurance,  should  play  secondary  parts  to  the 
man  who  carried  the  policy.  This  Dreamer  was  Colonel  Chauncey 
Monroe  Ransom,  then  of  Baltimore,  editor  and  publisher  of  an 
insurance  journal.  His  daily  work  brought  him  in  close  contact 
with  the  chaotic  conditions  of  his  time  and  also  with  many  of  the 
leaders  in  life  insurance  of  that  day.  Fortunately,  in  his  travels 
he  was  able  to  find  a  few  managers  and  general  agents  who  were 
willing  to  give  a  receptive  ear  to  his  story — yes,  to  his  prophecy. 
He  began  his  efforts  at  Cincinnati  in  1870,  and  after  two  years  of 
spasmodic  effort,  succeeded,  with  the  local  aid  of  Robert  Lansing 
Douglas  and  others,  in  organizing  the  first  association  of  life  un- 
derwriters at  Cincinnati.  This  was  shortly  followed  by  another 
association  in  Cleveland.  These  two  organizations  united  to  form 
the  Ohio  Association.  These  three  organizations  were  disbanded 
in  1878,  after  stormy  years  of  effort  to  enforce  rules  which  were 
intended  to  bring  about  a  millenium  at  once.  Their  influence  was 
too  restricted  geographically  to  make  any  marked  effect  upon  the 
life  insurance  business  at  large  at  that  time. 

Colonel  Ransom,  not  dismayed  by  the  failure  in  Ohio,  began,  five 
years  later,  his  efforts  in  Boston,  and  on  April  18th,  1883,  the 
Boston  Life  Underwriters  Association  was  organized  in  the  office 
of  The  Standard,  Colonel  Ransom's  paper.  This  association  was 
the  first  of  its  kind  to  endure.  Shortly  thereafter  it  Avas  followed 
by  another  association  organized  at  Pittsburgh.  During  the  six 
years  following,  local  associations  were  formed  at  Detroit,  St.  Paul, 
Buffalo,  New  York  City,  Philadelphia,  Kansas  City,  Chicago,  Cleve- 
land, and  in  the  states  of  Maine  and  New  Hampshire.  In  1890 
five  more  were  added,  namely:  Cincinnati,  Providence,  Baltimore, 
Nebraska  and  Vermont,  making  seventeen  in  all. 

These  seventeen  associations,  with  the  exception  of  those  of  St. 
Paul,  Kansas  City  and  Cincinnati,  took  part,  through  their  dele- 
gates, in  forming  the  National  Association  of  Life  Underwriters 
at  a  convention  held  at  the  Parker  House,  Boston.  June  18  and 
19,  1890. 

Unfortunately  for  the  rapid  development  of  tlie  underlying  prin- 
ciple of  this  movement,  some  of  the  life  insurance  companies  at  that 
time  began  to  "speed  up"  for  production  of  business.  From 
1890  to  the  time  of  the  great  investigation  in  1905  and  1906,  com- 
petition ran  riot — to  such  an  extent  that  it  seemed  as  though  the 
policies  of  tlie  home  offices  and  the  policies  of  the  National  Associ- 
ation of  Life  Underwriters  were  directly  antagonistic  to  each  other. 
It  was  during  the  latter  years  of  this  period  that  the  speaker  was 
chosen  to  lead  this  organization  for  one  year  as  its  executive  head. 

The  effort  of  the  home  offices'  demands  for  "business  at  any 


WORLD'S  INSURANCE  CONGRESS  167 

cost"  seemed  to  create  a  reflex  action  in  the  association  movement 
and,  as  the  speaker  remembers  those  days,  it  seemed  as  though 
the  chief  function  of  the  National  Association  of  Life  Under- 
writers was  the  political  fight  at  conventions  which  centered 
around  the  presidency. 

Through  all  these  years,  however,  there  were  "men  with  Vi- 
sions," and  their  numbers  were  gradually  increasing.  There 
were  Cochran  of  New  York,  Bowles  of  Detroit,  Register  of  Phila- 
delphia, Wyman  of  Chicago,  Dolph  of  Cincinnati  and  others  of 
that  day  who  worked  and  worked  and  worked  for  the  ultimate  up- 
building of  the  underlying  principle  of  this  association  movement, 
namely,  the  bettering  of  field  conditions  for  the  agent  and  through 
that  betterment  an  improved  situation  for  the  companies  them- 
selves and  a  decided  benefit  for  the  insured.  The  men  whose  names 
I  have  just  mentioned  were  presidents  of  this  association  during 
those  dark  days  which  were  marking  the  transition  from  old 
methods  to  the  better  conditions  of  to-day,  and  they  were  ably 
assisted  by  others  in  the  ranks  to  whom  the  "Vision"  had  been 
given. 

During  this  transition  period,  covering  the  years  from  1897 
to  1905,  each  succeeding  president  seemed  to  feel  it  incumbent 
upon  himself  to  do  a  great  deal  of  traveling  for  the  purpose  of 
visiting  the  old  association  and  creating  new  ones.  Each  president 
seemed  to  feel  that  in  order  to  make  his  administration  a  success 
he  must  cover  a  greater  mileage  than  his  predecessor.  Each  presi- 
dent gave  of  his  time  and  money  freely.  The  association  grew 
apace  as  the  result  of  the  work  done  by  these  presidents,  but  the 
movement  seemed  to  have  its  thoughts  on  the  past.  The  movement 
needed  a  torch  to  furnish  a  light  with  which  to  guide  the  masses 
of  field  men  to  this  "Vision,"  which  at  that  time  was  seen  by 
but  few. 

That  torch  was  provided  by  the  great  upheaval  of  life  insur- 
ance in  1905  and  1906.  This  upheaval  started  out  to  be  an  inves- 
tigation of  companies,  but  before  it  was  finished,  it  proved  to  be 
an  ordeal  for  life  insurance.  Some  of  the  companies  had  enemies, 
some  had  traducers.  The  flame  of  invidious  comparison  rapidly 
spread  from  the  companies  as  individuals  to  life  insurance  as  an 
institution.  Unfortunately  the  policyholders  themselves  were  alto- 
gether too  ignorant  of  the  technical,  the  business  and  the  ethical 
side  of  life  insurance.  The  insuring  public  needed  to  be  educated. 
Unfortunately  the  press  of  the  land  knew  altogether  too  little 
about  life  insurance,  as  was  evidenced  by  many  of  the  editorials 
and  by  many  of  the  scare  headlines  which  topped  unjust  items 
about  life  insurance  during  that  investigation. 

Seemingly  things  were  going  from  bad  to  worse.  Many  of  the 
sober  minded,  thinking  business  men  of  America  began  to  lose 
faith  in  life  insurance  and  to  lapse  policies  in  some  of  the  com- 
panies which  were  under  fire.  Many  of  the  newspapers  uncon- 
sciously helped  them  along.     The  State  insurance  commissioners 


168  WORLD'S  INSURANCE  CONGRESS 

of  tliat  day  suddenly  waked  up  and  then  became  alarmed.  Unfor- 
tunately, some  of  them  took  extreme  views  along  the  idea  that 
there  was  nothing  honest  about  the  life  insurance  companies  or 
their  officials.  This  feeling  of  distrust  on  the  part  of  insurance 
commissioners  on  the  one  side,  and  the  feeling  of  dread  on  the 
part  of  home  office  officials  concerning  commissioners  and  legis- 
latures on  the  other  side,  created  a  deadlock  between  the  home 
offices  and  the  insurance  departments  and  legislatures.  Neither 
side  seemed  to  be  willing  to  trust  the  other. 

Here,  then,  was  the  psychological  moment  for  the  agent  in  the 
field.  The  old  type  of  agent  of  which  I  speak  had  looked  upon 
himself  as  an  individual  strictly  representing  his  company.  He 
looked  upon  his  competitor  as  an  enemy.  He  suddenly  awoke  to 
find  that  he  and  his  imaginary  enemy,  working  hand  in  hand,  could 
serve  a  purpose  which  would  not  be  served  in  any  other  way.  He 
suddenly  found  himself  standing  in  the  center  of  a  triangle.  At 
one  point  of  the  triangle  stood  the  Policyholders,  at  another  point 
the  Home  Offices,  and  at  the  third  point,  the  State  Insurance  De- 
partments and  the  Legislatures.  He  found  himself  the  one  medium 
that  could  shorten  the  lines  of  this  triangle  and  bring  these  three 
points  closer  together.  He  found  that  the  first  step  necessary  to 
be  taken  should  be  one  of  understanding. 

The  then  President  of  the  National  Association  of  Life  Lender- 
writers,  Mr.  Charles  W.  Scovel,  of  Pittsburgh,  ably  assisted  by 
willing  associates,  devoted  practically  all  of  his  time  and  much 
money  in  an  effort  to  accomplish  this  result.  An  appeal  was 
finally  made  to  the  President  of  the  United  States  in  an  effort  to 
clear  the  atmosphere  and  restore  public  confidence  in  order  that  a 
new  foundation  of  mutual  trust  and  respect  might  be  created 
whereon  to  rear  a  Greater  Life  Insurance. 

The  speaker  has  always  regretted  that  at  that  particular  time 
absence  from  this  country  on  private  business  matters  kept  him 
out  of  the  wonderful  constructive  work  which  was  being  done  by 
some  of  those  noble  fellows  who  helped  to  save  the  situation  and 
who  are  to-day  the  backbone  of  modern  field  conditions.  Some  of 
the  names  which  will  grow  brighter  as  the  years  pass  include  those 
of  Charles  W.  Scovel,  Frank  E.  McMullen,  Ernest  J.  Clark, 
Richard  E.  Cochran,  Charles  Jerome  Edwards,  William  C.  John- 
son, Everett  H.  Plummer,  William  D.  Wyman,  and  a  long  list  of 
efficient  associates  who,  with  a  singleness  of  purpose  and  an  un- 
selfishness rarely  paralleled  did  much  to  steer  the  great  institution 
of  life  insurance  through  the  breakers  of  that  upheaval. 

The  climax  of  the  various  efforts  made  by  the  President  of  the 
United  States,  by  State  Governors,  attorneys-general  and  insur- 
ance commissioners,  by  home  office  officials,  by  life  insurance 
agents,  working  under  the  banner  of  the  National  Association  of 
Life  Underwriters,  and  by  many  prominent  policyholders,  was 
what  is  now  commonly  known  as  the  "Chicago  Conference."  This 
conference  was  held  in  February,   1906,  and  as  Scovel  puts  it. 


WORLD'S  INSURANCE  CONGRESS  169 

''Thus  it  came  about  that  the  organized  agents,  who,  during 
twenty-three  years  had  restricted  their  own  activity  to  field  mat- 
ters exclusively  were  called  upon  to  act  for  life  insurance  in  gen- 
eral and  for  the  policyholder  in  particular.  The  agent-delegates 
were  enrolled  with  the  state  officials  as  members  of  the  Chicago 
Conference.  Of  the  many  company  officials  present,  several  were 
allowed  to  speak  only  by  special  consent." 

Mr.  William  J.  Graham,  the  actuarial  advisor  to  the  Committee 
of  Fifteen  which  developed  from  the  Chicago  Conference,  deliv- 
ered an  address  at  the  1911  Convention  of  the  National  Associa- 
tion of  Life  Underwriters,  from  which  I  quote  in  part  as  follows: 

"The  revolution  in  life  insurance,  dating  from  five  or  six  years 
back,  has  done  much  to  develop  the  force  of  the  agent  in  life  in- 
surance affairs.  It  has  emphasized  the  agent's  position  as  a  rep- 
resentative, alike  of  the  policyholder  and  the  company.  I  think 
much  of  this  recognition  of  the  dual  capacity  of  the  agent  was 
first  won  by  the  representatives  of  the  Life  Underwriters  Asso- 
ciation at  the  Convention  of  Governors,  Attorneys- General  and 
Insurance  Commissioners  at  Chicago  in  February,  1906. 

"This  was  an  epochal  convention,  the  first  that  ever  brought  to- 
gether the  officials  of  the  different  States  in  joint  conference  to 
make  for  uniform  action  and  uniform  laws.  Company  officials 
beyond  number  were  present  at  the  convention  and,  later,  before 
the  famous  Committee  of  Fifteen  which  emanated  from  this  con- 
vention. Unfortunately  and  unreasonably  the  utterances  of  com- 
pany officials  were  discounted  at  that  time.  It  was  then  that  the 
agent  stepped  in  for  the  recognition  which  was  due  him  as  a  repre- 
sentative of  the  policyholder,  as  M^ell  as  of  the  company.  The  words 
of  the  agent  as  spoken  by  Mr.  Scovel  and  Mr.  Mcj\Iullen  and, 
later  by  William  C.  Johnston,  Charles  Jerome  Edwards  and  others, 
won  from  State  Officials  and  Legislatures  consideration  which  was 
denied  at  that  time  to  the  utterances  of  the  officials.  The  agent 
at  that  time  took  his  part  in  the  reconstruction  and  in  forward- 
ing the  renaissance  of  life  insurance — and  took  it  well." 

So  spoke  Mr.  Graham,  and  he  was  one  who  knew. 

Prior  to  this  Chicago  Conference,  the  agent  in  the  field  may 
properly  be  said  to  have  represented  his  company  and  only  his 
company.  His  thoughts  were  more  or  less  restricted.  They  were 
not  upon  life  insurance  as  an  institution,  but  rather  upon  the 
development  of  his  own  individual  company  and  the  fattening  of 
his  own  pocketbook. 

The  new  line  of  work  done  by  the  agent  as  a  result  of  the  up- 
heaval, while  proving  of  benefit  to  the  company  and  to  the  in- 
sured, proved  of  greater  benefit  to  himself.  It  caused  him  to 
awake  and  find  his  true  sphere  of  endeavor.  It  taught  him  that, 
as  the  trend  of  modern  religious  thought  is  along  the  line  of  the 
Fatherhood  of  God  and  the  Brotherhood  of  Man,  so  should  the 
trend  of  modern  successful  life  insurance  salesmanship  be  along 
the  line  of  the  Fatherhood  of  Life  Insurance  and  the  Brotherhood 


170  WORLD'S  INSURANCE  CONGRESS 

of  Life  Insurance  Companies:  the  fatherhood  of  life  insurance 
meaning  the  institution  of  life  insurance  as  a  protector  of  the 
home,  the  community  and  the  nation;  the  brotherhood  of  life  in- 
surance companies  meaning  that  each  company  could,  in  the 
future,  best  build  up  its  own  business  by  recognizing  itself,  not 
as  an  arbitrary  individual,  but  as  one  of  a  brotherhood  of  compa- 
nies, the  basic  principle  of  which  must  be  the  upbuilding  of  the 
institution  of  life  insurance  and  the  utter  elimination  of  the  tear- 
ing dowji  of  other  companies  by  unethical  competitive  methods  of 
doing  business. 

Therefore,  I  say,  from  the  date  of  the  Chicago  Conference,  the 
National  Association  of  Life  Underwriters  sprang  into  real  life. 
One  of  the  manifestations  of  this  real  life  was  the  establishment 
of  an  official  journal.  Life  Association  News,  a  monthly  paper  de- 
voted to  the  principles  of  the  Association  and  published  by  the 
association  at  56  Pine  Street,  New  York  City.  Mr.  Everett  M. 
Ensign,  its  editor,  is  also  Corresponding  Secretary  of  the  Asso- 
ciation. 

The  discovery  by  the  agent  that  his  primary  thought  should  no 
longer  be  the  commission  which  he  could  get  from  writing  a  policy, 
but  rather  that  it  should  be  the  greatest  good  that  he  could  do  for 
the  insured,  made  of  him  a  different  being.  The  admissions  by 
the  home  offices  and  by  the  insurance  departments  that  the  agent 
was  a  representative  of  the  policyholder  as  well  as  of  the  eom- 
pan}^,  was  largely  instrumental  in  enabling  the  agent  to  find  an 
outlet  for  his  endeavors  in  his  efforts  to  upbuild  that  for  which 
the  National  Association  of  Life  Underwriters  was  brought  into 
existence. 

Consequently,  since  the  Chicago  Conference,  historj^  has  been 
made  rapidly  by  this  association.  It  is  no  longer  a  one-man  affair. 
Its  conventions  are  no  longer  political  squabbles.  It  is  no  longer 
necessary  for  the  association  to  hunt  for  timber  to  take  the  presi- 
dency. There  are  dozens  of  understudies  amply  able  to  step  into 
the  breach  at  any  time.  In  the  old  days  the  president  often  ran 
the  association  about  as  he  saw  fit.  The  present  plan  is  an  execu- 
tive cabinet  consisting  of  seven  men,  including  the  president,  on 
whom  the  responsibility  of  the  success  of  the  movement  rests 
between  conventions.  Back  of  this  cabinet  lies  the  executive  com- 
mittee, holding  semi-annual  meetings  and  consisting  of  one  mem- 
ber from  each  association.  There  are  to-day  130  local  associations 
with  membership  in  the  national  body. 

Larger  opportunities  must  of  necessity  demand  greater  results. 
Tlie  National  Association  movement  to-day  is  fathering  a  number 
of  important  things  which  look  to  the  conservation  of  life  insur- 
ance, to  the  elimination  of  evil  practices  and  high  overhead  cost, 
to  the  education  not  only  of  the  insuring  public,  but  also  of  the 
student  body  in  our  colleges  and  liigh  schools,  to  the  reduction  or 
the  elimination  of  the  taxation  evil,  now  one  of  the  greatest  draw- 
backs to  tlie  fulfillment  of  the  mission  of  life  insurance  as  an  insti- 


WORLD'S  INSURANCE  CONGRESS  171 

tution,  namely,  the  elimination  of  want.  The  taxation  propaganda 
has  been  strongly  headed  by  Mr.  Edward  A.  Woods,  of  Pittsburgh, 
now  president  of  the  association. 

To  carry  on  the  Campaign  for  these  and  other  purposes,  the 
Association  has  established  its  Bureau  of  Education  and  Con- 
servation. This  is  a  comparatively  new  development  and  has  been 
most  ably  presided  over  by  Mr.  Warren  M.  Horner,  of  Minneapolis, 
Chairman.  One  of  the  ends  desired  by  this  bureau  is  a  radical 
departure  in  advertising  life  insurance.  It  aims  to  supplement 
the  present  purely  partisan  type  of  company  advertising  by  add- 
ing a  comprehensive  plan  for  the  institutional  advertising  of  life 
insurance  on  a  non-partisan  platform.  A  proposition  so  far-reach- 
ing as  this  must  of  necessity  grow  slowly  and,  as  it  grows,  some 
of  the  details  must  from  time  to  time  be  changed.  At  the  present 
this  bureau  is  directing,  through  an  increasing  number  of  local 
associations,  the  institutional  advertising  of  life  insurance  by  hu- 
man interest  advertisements  and  stories  in  the  daily  papers  for 
quick  consumption,  ultimately  to  be  rounded  out  by  a  district 
advertising  campaign  of  like  nature  in  periodicals  of  nation- 
wide circulation. 

Another  movement  now  being  directed  by  the  bureau  is  the  in- 
troduction of  life  insurance  courses  into  the  curricula  of  many 
of  the  universities  and  colleges  of  America.  This  will  later  be 
followed  by  educational  lectures  and  classroom  work  in  high  schools 
and  preparatory  schools.  Realizing  the  lack  of  an  adequate  text- 
book, exclusively  devoted  to  life  insurance,  for  colleges,  high 
schools  and  general  use,  the  bureau  has  procured  the  writing  of 
such  a  book  (now  in  press)  by  Professor  S.  S.  Huebner,  Ph.D., 
of  the  University  of  Pennsylvania,   a  leading  authority  on  the 

subject. 

Recently  an  effort  was  made  in  one  of  our  large  cities  to  ascer- 
tain the  feeling  of  the  public  mind  on  the  subject  of  life  insur- 
ance and  the  life  insurance  agent.  One  of  the  questions  asked 
was,  "Is  the  average  life  insurance  agent  welcome  to  call  upon 
you?"  Answers  developed  the  fact  that  the  life  insurance  sales- 
man was  persona  non  grata  in  the  offices  of  thirty  per  cent,  of  the 
business  and  professional  men  of  that  city  where  the  inquiry  was 

made. 

This  and  other  similar  observances  have  developed  the  fact 
to  the  leaders  of  the  association  movement  that  two  classes  of  indi- 
viduals must  be  further  educated  on  the  subject  of  life  insurance, 
namely,  the  agent  and  the  policyholder.  In  part  as  a  result  of  the 
educational  movements  fostered  by  the  National  Association,  some- 
of  the  companies  are  installing  life  insurance  correspondence 
schools  of  salesmanship  for  their  agents.  Agencies  are  holding 
weekly  meetings  or  periodical  meetings  where  the  agents  are  in- 
structed not  only  on  the  subjects  of  their  own  company  and  how 
to  sell  its  policies,  but  also  on  the  general  subject  of  life  insurance 
as  an  institution.    The  larger  agencies  are  employing  salaried  men 


172  WORLD'S  INSURANCE  CONGRESS 

whose  duties  are  to  secure  agents  and  to  train  those  agents  when 
secured,  not  only  in  salesmanship,  but  also  in  the  ethics  of  the 
business.  Some  of  the  local  associations  are  deeply  interested  in 
delivering  courses  of  lectures  on  life  insurance  in  universities  and 
high  schools  to  the  student  body  and  to  the  public.  These  lecture 
courses  frequently  develop  an  interest  on  the  subject  in  the  faculty 
of  the  institutions  where  such  lectures  are  given.  It  follows  that 
the  colleges  in  turn  add  life  insurance  courses  to  their  curricula. 
While  it  is  undoubtedly  true  that  some  of  these  colleges  are  doing 
so  in  an  experimental  way,  nevertheless  it  is  a  fact  that  to-day  over 
seventy  colleges  and  universities  in  the  United  States  have  adopted, 
to  a  greater  or  less  degree,  courses  in  life  insurance  instruction. 

It  is  a  conceded  point  that  the  public  at  large  needs  great  in- 
struction on  the  subject  of  life  insurance  as  an  institution  and  on 
its  benefits  to  the  individual,  to  the  family,  to  the  community  and 
to  the  nation.  It  is  further  admitted  that  the  agent  is  the  man 
on  whom  his  burden  must,  to  a  great  extent,  fall.  Therefore,  the 
necessity,  as  never  before,  is  for  agents  Avho  are  themselves  trained 
and  educated,  not  along  the  narrow  paths  of  the  past,  but  in  the 
broader  highways  of  the  present. 

The  National  Association  of  Life  Underwriters  has  just  com- 
pleted its  twenty-fifth  year.  One  month  ago  it  held  in  San  Fran- 
cisco its  twenty-sixth  annual  convention.  Those  twenty-five  years 
have  been  years  of  struggle,  years  of  effort,  often  followed  by  fail- 
ure, years  of  experiment  along  lines,  good,  bad  and  indifferent, 
and  in  a  measure  years  of  reconstruction.  Those  years  have  not 
been  without  their  successes.  Particularly  have  the  years  since 
the  Chicago  Conference  in  1906  been  marked  with  decided  success 
and  advancement  along  all  lines.  While  it  has  had,  as  an  organi- 
zation, much  to  do  in  reconstruction  of  old  methods,  it  has  also 
been  busy  with  new  and  constructive  building  along  many  lines 
of  work.  It  may  be  said  that  the  Association  has  now  passed  the 
period  of  reconstruction  and  is  now  well  out  on  the  high  seas  of 
construction. 

Its  present  mission  and  its  future  mission  are  those  of  useful- 
ness and  service  to  the  greatest  number  of  people.  This  can  be 
reached  only  through  the  education  of  desirable  agents  and  the 
elimination  of  undesirable  agents,  through  correct  methods  of 
salesmanship,  truthful  presentation  of  the  subject  and  honor- 
able competition. 

The  National  Association  of  Life  Underwriters  has  come  into 
its  own.  It  has  reached  the  full  stature  of  manhood.  It  is  a 
purely  representative  body.  Its  membership  consists  of  the  men 
who  are  the  direct  representatives  of  the  companies  and  of  the 
policyholders  at  one  and  the  same  time.  The  National  Associa- 
tion, with  its  wider  experience,  and  its  broader  knowledge,  and  its 
greater  opportunities  is  to-day  enabled  to  accomplish  along  con- 
structive linos,  nuich  for  the  upbuilding  of  life  insurance  as  a  na- 
tional institution. 


WORLD'S  INSURANCE  CONGRESS  173 

Let  me  repeat,  the  deep  underlying  principle  of  the  National 
Association  of  Life  Underwriters  is  that  iw  man  is  as  great  as  his 
company,  no  company  is  as  great  a»  the  institution  of  life  insur- 
ance. If  its  members  live  up  to  this  principle,  selfishness,  greed 
and  their  attending  evils  will  be,  if  not  entirely  eliminated,  so 
minimized  as  to  be  a  negligible  quantity  in  the  future  develop- 
ment of  the  institution.  The  agents  in  the  field,  members  of  this 
great  association  movement,  stand  ready  to  work  hand  in  hand 
with  company  officials,  with  insurance  departments,  with  legis- 
latures and  with  policyholders  for  the  future  of  the  business.  Its 
plea  to  the  world  is  that  the  association  movement  be  taken  at  its 
face  value,  that  its  members  be  recognized  as  the  representatives 
of  that  which  is  highest  in  ethics,  in  constructiveness  and  in  con- 
servation of  the  business. 

The  National  Association  of  Life  Underwriters  asks  from  the 
home  office  officials,  from  the  State  insurance  commissioners  and 
from  the  public  at  large,  their  assistance  in  its  effort  to  weed  out 
from  this  business  the  unethical,  the  unscrupulous,  the  untruthful 
and  the  destructive  type  of  agent,  in  order  that  this  movement  may 
the  better  accomplish  its  ultimate  end,  which  is  the  greatest  good 
for  the  greatest  number  with  a  minimum  of  waste. 


INTERNATIONAL  ASSOCIATION  OF  CASUALTY  AND 
SURETY  UNDERWRITERS  * 

By  E.  W.  De  Leon 
President,   Casualty  Company  of  America 

No  branch  of  insurance  has  in  recent  years  played  a  more  vital 
part  in  the  great  drama  of  life,  both  in  times  of  peace  and  of  war, 
than  the  various  forms  of  casualty  and  surety  insurance  that  are 
concerned  with  the  question  of  conservation  of  efficiency  in  com- 
mercial and  industrial  endeavor.  It  is  a  great  privilege,  there- 
fore, to  be  permitted  to  outline  briefly  the  relation  of  the  Inter- 
national Association  of  Casualty  and  Surety  Underwriters  to  the 
constructive  influence  of  insurance.  This  organization  consists  of 
fifty-seven  leading  and  influential  companies,  seven  individual 
members  and  one  honorary  member.  The  objects  and  purposes  of 
the  Association  as  stated  in  the  constitution  are:  "To  promote 
good  will,  harmony,  confidence  and  cooperation  generally  between 
the  members ;  to  devise  and  give  effect  to  measures  for  the  protec- 
tion of  their  common  interests,  and  to  observe  the  amenities  that 
should  exist  between  companies  and  associations."  This  declar- 
ation of  principles  does  but  scant  justice,  however,  to  the  far- 
reaching  and  constructive  influence  of  the  Association  in  relation 
to  the  kinds  of  insurance  coming  within  the  scope  of  its  activities. 

*  Address    not    Eead. 


174       WORLD'S  INSURANCE  CONGRESS 

For  twenty-five  years,  this  Association  and  its  predecessor,  the 
International  Association  of  Accident  Underwriters,  have  labored 
unceasingly  to  promote  the  best  interests  of  casualty  insurance, 
both  among  the  companies,  as  well  as  between  the  companies  and 
the  public.  Twenty-nine  conventions  have  been  held,  at  every  one 
of  which  some  progressive  step  forward  has  been  taken  to  place 
the  business  upon  a  higher  plane  of  efficiency  and  usefulness.  The 
vital  questions  affecting  the  relations  of  the  companies  to  their 
policyholders,  such  as  legislation,  reserve  requirements,  special  de- 
posits, taxes,  tinancial  statements,  policy  conditions  and  restric- 
tions, and  uniform  classification  of  risks,  are  given  special  consid- 
eration by  the  Association  with  a  view  of  conserving  the  interests 
of  the  public  not  less  than  that  of  the  Companies. 

Various  bureaus  affiliated  with  casualty  and  surety  business  were 
either  organized  by  the  Association  or  their  inception  originated 
with  it.  Among  the  more  important  of  these  may  be  named  the 
International  Claim  Association,  the  Bureau  of  Publicity,  the 
Hooper-Holmes  Information  Bureau,  and  the  Bureau  of  Personal 
Accident  and  Health  UnderwTiters.  In  addition  to  the  foregoing, 
many  organizations  are  identified  with  the  activities  of  the  Asso- 
ciation, including  the  AVorkmen's  Compensation  Service  Bureau, 
the  Surety  Association  of  America,  the  Burglary  Underwriters 
Association,  the  Plate  Glass  Service  and  Information  Bureau,  and 
the  Steam  Boiler  and  Fly  Wheel  Bureau.  Each  of  these  is  con- 
cerned with  the  better  organization  and  maintenance  of  its  par- 
ticular lines  of  insurance,  so  as  to  provide  the  greatest  possible 
service  to  the  public  and  to  meet  the  ever  increasing  demand  for 
complete  and  unlimited  protection.  It  is,  however,  indisputably 
true  that  the  development  of  these  associations  and  bureaus  has 
created  new  forms  of  insurance  to  keep  pace  with  the  progress  of 
industrial  evolution  in  America,  that  is  destined  to  place  this  coun- 
try in  the  vanguard  of  the  enlightened  nations  of  the  world. 

The  time  at  my  disposal  will  not  permit  of  any  detailed  ex- 
planation of  the  constructive  work  of  this  Association  and  of  the 
allied  organizations  in  the  campaign  of  education  that  is  eon- 
ducted  in  the  public  interest.  Two  instances  will  suffice  to  illus- 
trate. The  advent  of  Workmen's  Compensation  for  occupational 
accidents,  with  all  its  humanizing  influences  and  its  economic  prob- 
lems, and  the  rapid  relegation  of  Employers'  Liability  for  dam- 
ages to  the  judicial  scrapheap,  created  new  conditions  in  the  world 
of  industry  that  could  be  met  only  through  the  protection  afforded 
by  Compensation  Insurance.  The  leading  casualty  companies, 
members  of  this  Association,  promptly  rose  to  the  emergency  and 
although  liamperod  by  many  legal  and  constitutional  restrictions 
and  handicai)pod  by  unregulated  and  untrained  competition 
of  State  funds  and  employer's  associations,  fostered  by  the  com- 
missions or  boards  created  to  administer  these  compensation  acts, 
furnished,  nevertlicless,  to  employers  of  labor,  in  every  State  Avhere 
such  a  law  is  in  force,  complete  and  unlimited  protection,  both  as 


WORLD'S  INSURANCE  CONGRESS  175 

respects  their  obligations  under  the  Compensation  Act,  and  as  the 
underlying  employer's  liability  for  damages.  It  early  became 
apparent,  however,  that  physical  and  moral  hazards  of  manu- 
facturing plants  vary  greatly  even  in  the  same  industry  and  in  the 
same  locality,  and  that  a  uniform  rate  of  premium  cannot  always 
be  justly  applied  to  simila,r  industries. 

The  Workmen's  Compensation  Service  Bureau,  the  connecting 
link  between  the  companies  and  the  insuring  public,  became  in- 
terested in  the  subject  and  established  a  department  for  individual 
rating  of  manufacturing  plants  by  inspection  and  by  applying  an 
analytic  schedule  based  upon  a  series  of  standards,  known  as  "uni- 
versal safety  standards".  A  detailed  description  of  this  schedule 
rating  system  is  not  practicable  at  this  time,  but  it  would  be  im-> 
possible  to  overestimate  its  immense  economic  and  financial  valu"e 
to  employers  who  elect  to  accept  the  terms  of  a  compensation  law. 
The  direct  appeal  to  safeguard  machinery  and  appliances  and  to 
improve  conditions  in  factories,  as  respects  light,  air,  sanitation 
and  management,  through  the  inducement  of  lower  rates  has  re- 
sulted in  a  general  reduction  in  the  number  of  industrial  accidents 
and  diseases  and  in  a  marked  improvement  in  the  health  and  wel- 
fare of  workers.  In  this  result  alone  is  amply  demonstrated  the 
great  value  of  this  Association  to  society  at  large  by  the  elimina- 
tion of  a  part  of  the  economic  waste  due  to  disability  or  death  of 
the  employed.  The  reduction  in  the  cost  of  workmen's  compensa- 
tion insurance  through  the  application  of  this  schedule  also  means 
a  financial  saving  to  the  assured  in  one  of  the  fixed  charges  of  their 
business  and  renders  the  insurance  attractive  to  many  employers 
who  might  not  otherwise  be  disposed  to  avail  themselves  of  this 
protection.  Thus  it  is  that  a  wider  distribution  of  insurance  is 
secured  at  a  lower  average  cost,  while  at  the  same  time  the  con- 
servation of  efficiency  and  of  the  human  factor  in  industry  is  en- 
couraged and  rewarded.  In  matters  of  legislation,  the  Associa- 
tion's Executive  Committee  keeps  a  watchful  eye  over  all  pro- 
jected laws  likely  to  affect  adversely  the  relations  of  the  companies 
with  the  public  and  exerts  every  infliTcnce  to  defeat  the  passage  of 
such  laws.  When  the  Federal  War  Tax  Bill  was  pending  in  Con- 
gress in  August,  1914,  providing  that  a  revenue  stamp  should  be 
affixed  to  every  casualty,  fidelity  and  guaranty  insurance  policy, 
when  issued,  to  the  amount  of  one-half  of  one  per  cent,  on  each 
dollar  (or  fractional  part)  of  the  premium  charged,  this  Associa- 
tion, through  the  work  of  the  Secretary,  ably  assisted  by  execu- 
tives of  some  of  the  members,  secured  the  following  important  con- 
cessions from  Congressional  Committees:  Exemption  from  the  tax 
of  policies  of  reinsurance;  casualty  insurance  on  property  coming 
under  the  provisions  of  that  section  of  the  act  relating  to  the  tax 
on  property  insurance,  not  to  be  taxed  again  under  the  paragraph 
relating  specifically  to  casualty  insurance.  After  the  enactment 
of  the  law,  the  question  was  raised  as  to  who  should  pay  the  tax, 
the  insurance  company  or  the  assured.     Varying  views  were  ex- 


176  WORLD'S  INSURANCE  CONGRESS 

pressed  by  different  companies,  but  the  unanimous  opinion  finally 
prevailed  that  the  entire  burden  of  the  tax  should  fall  upon  the 
companies,  notwithstanding  that  other  quasi-public  utility  corpo- 
rations, such  as  express  companies,  telegraph  and  telephone  com- 
panies and  banks  invariably  collected  the  tax  from  the  customer. 
Thus  again,  casualty  and  surety  insurance,  represented  by  this 
Association,  performs  a  public  service  that  inures  to  the  benefit 
of  its  patrons  and  the  people  at  large.    These  instances  typify  the 
kinds  of  service  rendered  by  the  Association  in  times  of  peace  and 
under  normal  conditions.     There  is,  however,  another  kind  of  ser- 
vice made  possible  by  the  abnormal  situation  created  by  the  war 
in  Europe,  upon  which  many  of  the  largest  financial  and  commer- 
cial transactions  ever  accomplished  in  this  country  are  predicated. 
Surety  bonds  aggregating  millions  of  dollars  have  been  issued 
on  behalf  of  American  manufacturers  to  the  nations  at  war,  guar- 
anteeing the  performance  of  contracts  entered  into  for  the  manu- 
facture and  delivery  of  munitions  and  supplies.     These  bonds  are 
required  from  responsible  manufacturers,  as  well  as  from  many 
whose  financial  condition  and   business  standing  can  largely  be 
made  satisfactory  only  through  a  surety  bond.     Many  so-called 
"War  Supply  Contracts"  are  widely  distributed  among  a  large 
number  of  producing  plants  in  every  part  of  the  country,  which 
have  enabled  employers  to  keep  their  working  force  fully  employed 
during  the  otherwise  dull  season,  obviating  the  necessity  of  cur- 
tailment in  the  number  of  employees  or  of  shutting  down  the  plant 
entirely.     The  profits  accruing  to  the  manufacturer,  the  steady 
employment  secured  by  the   wage-earner,   the   amount  expended 
with  contractors  for  new  buildings  and  with  other  manufacturers 
for  new  machinery,  raw  materials  and  supplies,  all  would  be  im- 
possible, nay  even  the  destiny  of  nations  might  tremble  in  the 
balance  and  empires  be  rendered  defenceless  and  impotent,  except 
for  the  service  performed  by  surety  companies  in  meeting  this  crit- 
ical and  exceptional  situation  in  a  broad  spirit  of  constructive  coop- 
eration, rather  than  of  destructive  discouragement. 

In  another  conspicuous  way  has  the  Association  contributed  to 
the  general  uplift  of  mankind  in  the  highest  ethical  and  social 
sense.  For  many  years,  three  gold  medals  are  awarded  annually 
to  persons,  who  in  the  estimation  of  the  Association  have  displayed 
great  heroism  in  voluntarily  saving  human  life.  These  awards  are 
recommended  by  a  Standing  Committee,  known  as  the  George  E. 
McNeill  Medal' Committee,  and  the  medals  are  presented  to  the 
recipients  or  their  representatives  at  the  annual  convention  of  the 
Association.  History  is  replete  with  the  names  of  brave  men  and 
women,  who,  either  in  the  delirium  of  battle  or  in  response  to  the 
call  of  duty,  have  been  decorated  by  their  King  or  their  country 
for  acts  of  heroism,  in  saving  or  destroying  human  life.  We  are 
thrilled  although  horrified,  in  these  clays  of  conflict  and  carnage 
among  the  nations  of  Europe,  to  read  of  such  conspicuous  deeds 
of  bravery  and  of  their  reward.    The  decorations  of  the  Iron  Cross, 


WORLD'S  INSURANCE  CONGRESS  177 

the  Victoria  Cross,  the  Legion  of  Honor  and  the  Medal  of  St. 
Vladimir  appear  almost  daily  in  the  chronicles  of  the  titanic 
struggle  that  has  transformed  historic  cities  and  fertile  countries 
into  desolate  ruins  and  utter  devastation.  The  McNeill  Medals 
are  decorations  for  heroism  performed  under  vastly  different  con- 
ditions. No  blare  of  trumpets  or  crash  of  martial  music,  no  irre- 
sistible force  of  frenzied  combat,  are  the  accompaniments  of  these 
acts  of  bravery.  No  call  of  duty  to  be  performed  prompts  the 
risking  of  one  life  in  the  hope  of  saving  another.  Impelled  by 
that  Divine  impulse  of  self-sacrifice  for  the  cause  of  humanity, 
these  heroes  exemplify  the  highest  and  noblest  type  of  bravery 
in  their  voluntary  and  deliberate  disregard  of  self,  of  home  and 
loved  ones,  of  ambition,  hope,  even  of  life  itself.  No  greater  ser- 
vice can  be  rendered  by  insurance  to  the  world  than  the  public 
recognition  of  those  attributes  of  the  higher  citizenship  through 
the  award  of  the  iNIcNeill  Medals  by  the  International  Association 
of  Casualty  and  Surety  Underwriters. 

No  narrative  however  incomplete,  of  the  work  of  the  Association 
in  relation  to  insurance  would  be  worthy  of  record  without  a  pass- 
ing tribute  to  the  memory  of  those  founders  of  the  organization 
who  have  journeyed  to  the  land  from  which  no  traveler  ever  re- 
turns. They  comprise  the  gallery  of  Immortals  whose  noble  ex- 
ample and  beneficent  influence  are  ever  the  directing  genius  of 
the  Association's  accomplishments.  The  huge  figure  of  the  great 
Hercules  portrayed  upon  the  official  poster  of  the  Congress,  forcing 
apart  the  cliffs  of  the  continents  of  North  and  South  America  to 
admit  the  waters  of  the  oceans  and  their  fleets,  typifying  the  per- 
sonification of  power,  is  but  emblematic  of  the  giant  forces  that 
contributed  so  greatly  to  establishing  and  developing  this  Associa- 
tion. 

The  "World's  Insurance  Congress  honors  itself  by  inscribing  the 
names  of  George  E.  McNeill,  James  G.  Batterson,  George  M.  Endi- 
cott,  Christopher  P.  Ellerbe,  Arthur  W.  Masters,  William  C.  May- 
bury  and  George  F.  Seward  among  the  greatest  names  upon  the 
imperishable  honor  roll  of  insurance  achievement. 


NATIONAL  FIRE  PROTECTION  ASSOCIATION 

By  Franklin  H.  Wentworth 
Secretary 

I  am  very  grateful  to  the  Chairman  for  his  cordial,  friendly  and 
encouraging  introduction  of  this  subject.  I  understand  the  thing 
for  me  to  do  to-day  is  to  connect,  as  briefly  as  possible,  the  relation 
of  the  National  Fire  Protection  Association  to  insurance,  and  so 
very  briefly  I  have  prepared  this  paper. 

Every  profession  and  everj^  business,   if  it  is  to  endure  and 


178  WORLD'S  INSURANCE  CONGRESS 

continue  to  serve  the  demands  of  life,  must  seek  out  the  me- 
chanics and  physical  facts  which  underlie  it,  and  adapt  its  poli- 
cies to  harmonize  with  the  same.  The  mechanics  of  a  business  obey 
laws  not  made  by  man.  That  is  why  they  do  not  yield  to  the  hu- 
man will.  They  cannot  be  altered :  they  can  only  be  comprehended 
and  observed. 

Of  all  the  so-called  natural  elements  the  element  of  fire  is  the 
most  rebellious,  the  most  elusive,  and  exacts  the  most  constant  pen- 
alties. It  is  no  wonder  primitive  man  attributed  its  possession  by 
him  to  the  special  favor  of  a  friendly  god.  Under  many  forms 
it  lurks  to  serve  mankind  when  comprehended,  but  to  strike  him 
when  ignored.  It  flashes  in  the  lightning  stroke;  it  resides  latent 
in  chemical  substances  and  fluids;  it  lies  potentially  in  common 
wood  and  coal  awaiting  man's  need  and  call. 

The  scientific  basis  of  fire  insurance  is  not  acumen  displayed 
in  the  investment  of  premiums;  it  is  the  comprehension  of  the 
habits  of  fire.  After  centuries  of  primitive  assumption  that  the 
destruction  of  a  man's  house  by  fire  was  an  act  of  God  we  know 
now  that  every  fire  which  occurs  where  it  is  not  desired  is  the 
direct  result  either  of  man's  ignorance  or  neglect. 

In  less  than  half  a  century  fire  underwriting  has  evolved  from 
a  status  largely  a  game  of  chance  to  one  reasonably  scientific.  It 
is  not  the  individual  property  which  any  longer  baffles  the  intelli- 
gent underwriter;  it  is  the  sweeping  fire  or  conflagration  hazard 
w^hich  survives  in  our  cities,  still  built  largely  of  wood,  that  fur- 
nishes the  old  element  of  underwriting  uncertainty  and  concern. 
This  element  it  requires  community  action  or  cooperation  to  elim- 
inate, demanding  first  a  public  comprehension  of  the  dangers,  and 
then  the  collective  will  to  apply  modern  engineering  correctives. 

The  twenty  years'  researches  of  the  National  Fire  Protection  As- 
sociation into  fire  causes,  and  its  carefully  digested  records  of  more 
than  fifteen  thousand  fires  in  properties  of  every  variety,  have 
produced  a  literature  from  which  reliable  conclusions  may  be 
drawn  respecting  the  hazards  existent  in  any  individual  risk.  On 
the  other  hand  the  mechanical  appliances  for  retarding  and  extin- 
guishing fire,  which  the  activities  of  the  Association  have  devel- 
oped, make  fire  control  so  reasonably  certain  as  to  leave  no  class 
of  industries  any  longer  undesirable  or  unprofitable  from  an  under- 
writing viewpoint  if  proper  attention  to  their  safeguarding  is 
given. 

Having  for  many  years  rendered  this  special  engineering  and 
research  service  to  the  underwriters,  which  service  it  still  con- 
tinues to  render,  the  National  Fire  Protection  Association  some 
six  years  ago  awakened  to  a  larger  responsibility  and  effort.  The 
increasing  proportions  of  the  fire  waste  and  the  public  negligence 
and  indifference  of  which  it  was  the  result  demanded  a  large  and 
persistent  educational  effort.  The  people  staggering  under  the 
amazing  economic  burden  of  the  fire  tax,  and  not  understanding 
that  the  reason  for  it  lay  in  their  own  habits  of  life,  had  begun 


WORLD'S  INSURANCE  CONGRESS       179 

hostile  legislative  attacks  upon  the  fire  insurance  business,  the 
only  agency  which  under  existing  conditions  stands  between  their 
communities  and  possible  annihilation.  In  its  work  of  public  in- 
formation, designed  to  illustrate  the  causes  of  this  excessive  fire 
tax  and  to  point  out  the  logical  and  reasonable  methods  of  its  re- 
duction, the  association  has  had  the  constant  and  loyal  cooperation 
of  its  underwriter  members,  and  direct  financial  assistance  from 
the  principal  American  fire  insurance  organization,  the  National 
Board  of  Fire  Underwriters. 

The  educational  efforts  of  the  National  Fire  Protection  Asso- 
ciation have  been  various  and  have  covered  and  continue  to  cover 
a  wide  range.  A  fundamental  need  was  the  preparation  of  an 
entire  literature  in  terms  the  public  might  comprehend.  This 
great  work  has  been  accomplished,  culminating  last  year  in  the 
publication  of  "Field  Practice,"  the  Association's  fire  inspection 
manual,  already  the  official  hand-book  of  the  leading  inspection 
departments  of  the  country,  state,  municipal  and  underwriting, 
and  indispensable  to  any  one  in  any  position  charged  with  the  care 
of  property. 

Every  available  avenue  has  been  followed  to  bring  the  Associ- 
ation's popular  and  engineering  literature  to  the  attention  of  the 
people  collectively  and  individually  and  to  secure  the  public  and 
private  adoption  of  safeguards  designed  to  reduce  the  profligate 
and  shameless  ash  heap  of  the  nation.  Model  building  codes  and 
model  laws  and  ordinances  for  the  reduction  of  hazards  have  been 
evolved;  the  establishment  and  observation  of  fire  prevention  day 
have  been  promoted ;  constant  and  regular  housekeeping  inspections 
by  members  of  city  fire  departments  have  been  successfully  advo- 
cated ;  the  establishment  of  the  office  of  fire  marshal  in  many  states 
and  cities  has  been  accomplished ;  fire  prevention  instruction  in 
the  public  schools  has  been  urged,  and  many  less  conspicuous 
efforts  have  been  made  in  directions  calculated  to  bring  desirable 
and  enduring  results. 

The  National  Fire  Protection  Association  is  the  university  of 
the  student  of  the  fire  waste.  Its  membership  is  found  in  every 
country  of  the  civilized  world.  It  furnishes  to  the  United  States 
and  Canada  the  forum  in  w'hich  meet  for  debate,  for  enlighten- 
ment and  for  the  reconcilement  of  differences,  underwriters,  fire 
chiefs,  insurance  commissioners,  fire  marshals,  engineers,  archi- 
tects, builders,  manufacturers,  and  many  others  in  various  walks 
of  life,  whose  business  interest  or  good  citizenship  leads  them  to 
join  in  a  common  effort  to  improve  the  living  efficiency  of  their 
country  and  to  rescue  it  from  needless  economic  impoverishment 
by  an  easily  avoidable  fire  waste. 

The  Association's  work  of  public  information  is  bearing  its 
proper  fruit.  From  all  parts  of  the  nation  now  come  protests 
against  the  reckless  habit  of  our  citizens  respecting  fire,  and  the 
cry  for  a  civic  and  engineering  knowledge  and  experience  with 
which  to  combat  it.     This  is  the  service  of  the  National  Fire  Pro- 


180       WORLD'S  INSURANCE  CONGRESS 

tection  Association :  To  equip  from  its  treasury  of  research  and  in- 
formation all  of  the  knights  of  American  progress  who  desire  to 
break  a  lance  against  the  nation's  active  and  persistent  enemy — 
the  Scourge  of  Fire. 


ASSOCIATION  OF  LIFE  INSURANCE  PRESIDENTS 

By  Charles  A.  Peabody 
President,  Mutual  Life  Insurance  Company  of  New  York 

In  an  address  delivered  last  winter  at  a  gathering  of  business 
men  in  the  Middle  West,  President  Wilson  urged  them  to  lend  aid, 
through  the  association  to  which  he  was  speaking,  to  the  framing 
of  legislation,  saying: 

"It  is  very  instructive  and  useful  for  the  Government  of  the 
United  States  to  have  such  means  as  you  are  ready  to  supply  for 
getting  a  sort  of  consensus  of  opinion  which  proceeds  from  no 
particular  quarter  and  originates  with  no  particular  interest,  be- 
cause information  is  the  very  foundation  of  all  right  action  in  leg- 
islation. ,  .  .  Men  on  the  inside  of  business  know  how  business  is 
conducted,  and  they  cannot  complain  if  men  on  the  outside  make 
mistakes  about  business  if  they  do  not  come  from  the  inside  and 
give  the  kind  of  advice  which  is  necessary. ' ' 

The  need  which  the  President  recognized  and  asked  these  busi- 
ness men  to  supply  was  a  helpful  and  constructive  attitude  on  their 
part,  based  upon  their  intimate  knowledge  of  what  would  protect 
11)e  public  against  the  unscrupulous,  without  doing  injury  to  hon- 
est business.  He  asked  that  the  information  and  help  be  furnished 
through  an  association  such  as  he  was  addressing,  to  the  end  that 
it  might  represent  their  common  interests  and  a  collective  point 
of  view. 

It  is,  therefore,  a  matter  of  satisfaction  to  be  able  to  note  here 
and  on  this  occasion  that,  for  a  period  of  over  eight  years  prior 
to  the  delivery  of  the  President's  address,  life  insurance  companies 
had  been  doing,  for  the  protection  of  their  policyholders'  interests, 
just  what  the  President  said  was  needed  for  the  guidance  of  law- 
makers in  dealing  with  business  institutions. 

The  Association  of  Life  Insurance  Presidents  was  organized  in 
December,  1906,  under  a  constitution  in  which,  among  others,  the 
following  object  was  set  forth:  "To  consider  carefully  important 
measures  that  may  be  introduced  from  time  to  time  in  legislative 
bodies  with  a  view  to  ascertaining  and  publicly  presenting  the 
grounds  which  may  exist  for  their  adoption  or  rejection  by  the 
legislature." 

That  this  was  a  job  of  no  small  proportions  is  shown  by  the  rec- 
ord of  the  proposed  legislation  it  has  been  called  on  to  consider  in 
the  nine  years  of  its  existence.    During  that  time  Congress  and  the 


WORLD'S  INSURANCE  CONGRESS  181 

legislatures  of  the  various  States  have  held  258  regular  sessions 
and,  in  addition,  more  than  75  special  sessions.  In  these  sessions 
over  ten  thousand  bills  affecting  life  insurance  companies  and 
requiring  careful  scrutiny  by  them  were  introduced.  In  verbal 
volume  this  flow  averaged  during  the  "open  seasons"  for  cor- 
poration baiting  more  than  15,000  words  a  day.  In  purpose  and 
intent  these  bills  ranged  from  control  of  what  agents  might  say 
in  their  canvassing  activities  to  direction  in  detail  of  how  books 
should  be  kept  and  accounts  rendered  by  the  home  office.  They 
even  directed  the  formulation  of  the  contracts  which  might  be  made 
with  policyholders  and  specified  the  periods  of  time  under  which 
companies  would  be  obligated  to  fulfill  their  side  of  the  contracts 
even  after  policyholders  had  defaulted  in  their  payment  of  prem- 
iums, to  the  disadvantage,  of  course,  of  their  persistent  fellow- 
policyholders.  In  this  flood  were  included  many  proposals  to  in- 
crease by  vast  amounts  the  six  or  more  separate  and  distinct  varie- 
ties of  taxation  already  existent,  under  which  policyholders  have 
actually  contributed  to  the  support  of  the  Government  during 
these  same  nine  years  over  $105,000,000. 

An  attempt  to  classify  these  legislative  "musts"  and  "don'ts" 
shows  70  separable  and  more  or  less  distinct  species,  with  several 
hundred  left  over  for  the  miscellaneous  column,  because  they  were 
unlike  anything  ever  proposed  before.  Such  was  the  legislative 
output  which  life  insurance  companies  have  had  to  read,  analyze, 
criticize,  commend  or  oppose  during  the  years  1907  to  1915,  in- 
clusive. 

Here,  therefore,  do  we  find  at  least  one  reason,  and  it  seems 
to  me  a  very  potent  one,  for  maintaining  an  association  and  man- 
ning it  with  specialists  in  the  field  of  law-meaning  and  law-mak- 
ing, to  the  end  that  this  vast  mass  of  legislation  may  be  analyzed 
from  the  standpoint  of  policyholders'  interests  with  a  view  to 
showing  legislators  what  would  be  the  effect  of  such  laws  if  they 
were  placed  upon  the  statute  books.  While  other  business  insti- 
tutions and  even  the  States  themselves  are  now  establishing  bureaus 
for  the  giving  of  expert  advice  with  reference  to  proposed  legisla- 
tion, life  insurance  companies  were  induced  to  take  the  lead  in  this 
movement  because  of  their  extensive  and  intimate  relation  with 
the  public  at  large  under  contracts  involving  not  merely  one  trans- 
action, but  a  continuing  series,  limited  in  period  of  time  only  by 
the  years  their  policyholders  may  live.  These  long-term  contracts 
reaching  back  into  days  when  statutory  control  of  business  had 
been  little  thought  of  in  this  country  and  the  business  was  in  its 
infancy,  practically  compelled  life  insurance  companies  to  point 
out  to  legislators  the  effects  of  pending  legislation  on  existing 
contracts,  which  the  legislator  himself  had  never  intended  when 
preparing  his  bill  to  control  future  action  under  modern  condi- 
tions. 

On  the  other  hand,  there  has  been  reason  for  the  enactment  of 
many  laws  needed  to  meet  new  conditions,  and,  as  to  this,  such  an 


182       WORLD'S  INSURANCE  CONGRESS 

association  as  I  speak  for  is  equipped  to  give  valuable  aid  and  ad- 
vice by  pointing  out  what  can  be  done  to  protect  the  public  against 
that  which  is  bad,  without  destroying  or  seriously  interfering  with 
that  which  is  good.  It  was  for  such  constructive  help  that  the 
President  made  his  appeal,  and  it  is  along  this  line  that  I  feel  the 
Association  of  Life  Insurance  Presidents  has  perhaps  been  most 
useful.  At  any  rate,  we  know  that  during  the  nine  years  already 
referred  to,  while  there  have  been  enacted  at  least  30  statutes 
directly  affecting  the  interests  of  life  insurance  policyholders — 
many  of  them  being  complete  insurance  codes — with  but  few  ex- 
ceptions they  have  not  been  seriously  harmful  to  reputable  life 
insurance  companies. 

Another  important  object  of  our  Association,  as  expressed  in 
its  constitution,  is  "to  promote  economy  and  reduce  expenses  in 
the  matter  of  general  administration  by  an  interchange  of  views 
on  practice  among  life  insurance  companies" — in  other  words,  to 
maintain  a  clearing  house  of  information  and  a  forum  in  which 
may  be  discussed  all  questions  relating  to  the  betterment  of  life 
insurance  service. 

This  is  a  very  broad  field  of  interest  and  at  times  one  difficult 
to  occupy  without  conflicts  such  as  are  likely  to  spring  from  vary- 
ing individual  opinions  and  interests.  We  have,  indeed,  had  occa- 
sion to  recall  at  times  Mr.  Morton's  prophecy  at  our  first  meeting 
that  "clouds  will  now  and  then  hang  over  us,  that  temporarily 
we  will  entertain  poor  opinions  of  one  another's  views,"  yet 
on  the  whole  such  discussion  has  been  most  useful  and  has  always 
worked  to  the  advantage  of  our  policyholders.  Its  range  and 
ramification  are  indicated  by  the  appended  lists  of  subjects  * 
which,  among  others,  have  been  considered  at  meetings  of  the 
Association  and  its  Executive  Committee  or  concerning  which  spe- 
cial inquiry  has  been  made  through  correspondence  and  investiga- 
tion on  the  part  of  its  officers  and  employees. 

When  we  come  to  realize  that  these  discussions  and  inquiries, 
largely  related  to  technical  subjects  having  directly  to  do  with  the 
proper  management  of  the  life  insurance  business,  have  actually 
resulted  under  a  provision  for  "an  interchange  of  views  on  prac- 
tice of  life  insurance  companies,"  it  will,  I  think,  be  conceded 
that  the  Association  has  rendered  a  most  valuable  service  to  its 
members  acting  in  their  capacities  as  trustees  for  millions  of 
American  policyholders. 

It  has  been  estimated  recently  that  nearly  4,700  statutory  re- 
quirements or  prohibitions  relating  specifically  to  the  life  insur- 
ance business  are  to  be  found  in  the  laws  of  the  various  States. 
Among  these  are  946  imposing  specific  penalties  for  failure  to 
observe  the  law's  command.  In  many  instances  nothing  short 
of  a  last  guess  by  the  Supreme  Court  can  establish  with  cer- 
tainty what  the  law  in  question  really  means.  It  would  be  suffi- 
ciently difficult  to  carry  on  a  business  under  such  a  nudtiplicity 

*  See  end  of   Addit'ss. 


WORLD'S  INSUEANCE  CONGRESS  183 

of  laws  if  they  were  in  one  code  and  applicable  alike  in  all  States. 
But,  in  fact,  there  is  great  dissimilarity  between  the  laws  of 
different  States.  With  such  a  maze  confronting  each  company, 
the  Association  of  Life  Insurance  Presidents  undertook  the  prepa- 
ration of  a  card  index  of  statutory  requirements  on  which  were 
noted,  under  appropriate  classifications,  the  numberless  provi- 
sions governing  the  conduct  of  this  business.  This  card  index 
was  placed  in  the  hands  of  members  and  is  kept  up  to  date  by 
reprinting  cards  as  occasion  may  require.  It  covers  not  only 
laws,  but,  to  some  extent,  rulings  of  commissioners,  opinions  ren- 
dered by  attorneys-general  and  important  court  decisions.  The 
magnitude  of  this  work  is  shown  by  the  fact  that  its  preparation 
and  the  revision  required  during  the  three  years  in  which  it  has 
been  in  use  has  compelled  the  printing  of  8,313  cards,  each  con- 
taining from  one  to  six  notations. 

A  feature  of  this  index  is  a  card  calendar  of  statutory  require- 
ments on  which  notice  is  given  of  things  which  must  be  done 
throughout  the  year,  such  as  filing  statements,  making  tax  returns, 
securing  renewals  of  licenses,  etc.  An  examination  of  these  cards 
shows  that  in  order  to  retain  the  right  to  do  business  in  the  differ- 
ent States  or  to  avoid  the  payment  of  penalties,  there  is  not  a 
single  month  in  the  year  when  there  is  not  required  some  compli- 
ance with  statutes  on  which  depends  the  company's  right  to  con- 
tinue doing  business  in  some  of  its  territory.  So  numerous  and  so 
onerous  are  such  requirements  and  so  many  the  days  on  which 
prompt  attention  is  of  prime  importance,  that  most  of  the  larger 
companies  maintain  a  bureau,  the  function  of  which  is  to  deter- 
mine what  must  be  done  and  to  see  that  whatever  is  needed  shall 
be  done  within  the  time  limit  imposed  by  the  statutes  of  the  several 
States  in  which  the  companies  are  doing  business. 

A  few  years  ago  statutory  regulation,  in  detail,  of  the  life  in- 
surance business  was  left  largely  to  less  than  a  half  dozen  States 
which  had  taken  the  lead  in  the  matter.  Now  the  tendency  seems 
to  be  toward  each  State  enacting  a  complete  insurance  code  of 
its  own,  thereby  multiplying  very  greatly  the  danger  of  legal  en- 
tanglements. As  there  seems  to  be  no  tendency  toward  repeal  of 
these  laws,  it  is  not  difficult  to  understand  why  it  is  advantageous 
for  companies  to  cooperate  in  their  efforts  to  keep  informed  regard- 
ing what  the  various  laws  require  of  them.  Generally  speaking, 
it  is  not  possible  to  rely  on  a  moral  sense  of  what  is  right  or  wrong, 
since  there  are  numberless  instances  in  which  what  is  legal  and 
deemed  perfectly  proper  in  one  State  has  been  made  unlawful  and 
is  regarded  as  heinous  in  another.  In  fact,  the  number  and  va- 
riety of  penalties  imposed  for  violation  of  statutes  relating  to  our 
business  sometimes  makes  us  wonder  that  any  executive  officer  is 
able  to  remain  at  large. 

The  library  of  the  Association  of  Life  Insurance  Presidents 
contains  about  3,500  volumes  and  1,500  pamphlets,  including 
current  reports  and  the  usual  technical  works.     Its  chief  distinc- 


184       WORLD'S  INSURANCE  CONGRESS 

tion  and  perhaps  its  greatest  value  rests  iu  the  effort  being  made 
to  keep  its  members  in  touch  with  current  public  opinion  in  so 
far  as  it  finds  expression  in  the  public  press.  This  is  accom- 
plished by  systematically  reading  and  clipping  insurance  news  as 
it  appears  from  day  to  da3^  The  accumulation  up  to  this  tiire — 
all  duly  classified  and  indexed — amounts  to  more  than  90,000 
items,  many  of  which  are  growing  in  historical  value  as  they  de- 
cline in  current  interest.  This  system  not  only  gives  information! 
regarding  local  discussions  of  life  insurance  topics,  but  also  fur- 
nishes data  regarding  the  organization  of  and  progress  being  made 
by  life  insurance  companies  throughout  the  United  States.  It 
is  arranged,  classified  and  indexed  under  about  900  main  head- 
ings and  200  subheadings. 

Inasmuch  as  this  business  has  been  brought  under  direct  con- 
trol and  guidance  of  insurance  departments  in  the  several  States, 
it  becomes  necessary  to  have  at  hand  up-to-date  information 
regarding  the  personnel  of  these  various,  departments.  Since  they 
are  more  or  less  subject  to  the  vicissitudes  of  partisan  polictics, 
a  great  many  changes  take  place,  as,  for  instance,  during  the  past 
year,  when  there  w^re  twenty-four  changes  in  the  heads  of  such 
departments,  to  say  nothing  of  changes  in  the  positions  of  depu- 
ties, actuaries,  inspectors,  etc.  Information  regarding  these 
changes  is  gleaned  from  the  Association's  clipping  service  and 
furnished  to  members  by  means  of  a  bulletin  service  covering  this 
and  other  matters  of  current  interest  and  importance. 

"To  promote  the  welfare  of  policyholders"  is  another  subdivi- 
sion of  our  activities,  as  outlined  by  the  constitution.  An  impor- 
tant development  under  this  heading  has  been  the  effort  to  pro- 
long the  lives  of  policyholders.  Soon  after  the  formation  of  the 
Association,  careful  consideration  was  given  to  the  '.(uestion  of 
what  might  be  done  toward  improving  the  mortality  risk  among 
our  insured.  This  study  was  not  designed  to  produce  something 
in  substitution  for  the  present  examination  of  applicants  for  in- 
surance, but  to  aid  in  keeping  the  policyholders  in  as  good  health 
as  when  that  examination  was  made.  We  frankly  approached  this 
subject  of  prolonging  the  lives  of  policyholders  strictly  as  an 
economic  or  business  proposition  and  not  from  the  sentimental 
side  of  longer  years  for  the  individual.  But,  of  course,  if  we  suc- 
ceed in  decreasing  the  mortality  factor  of  cost,  policyholders'  lives 
will  be  lengthened.  This,  we  find,  has  made  a  strong  appeal  to 
the  imagination  of  our  insured,  and  has  excited  great  niterest  in 
our  efforts.  Therefore,  our  activities  in  this  field  promise  to  work 
out  satisfactorily  in  more  ways  than  one. 

Various  other  subjects  have  been  taken  up  under  the  heading 
of  "Welfare  of  Policyholders,"  ranging  from  reduction  of  the 
lapse  rate  in  life  insurance  to  the  development  of  contracts  de- 
signed still  further  to  protect  beneficiaries  in  the  matter  of  con- 
serving policy  proceeds. 

But  it  is  useless  to  attempt  enumeration  of  Association  activities 


WORLD'S  INSURANCE  CONGRESS  185 

under  this  provision,  because  in  the  last  analysis  it  is  inclusive 
of  everything  that  is  being  done  for  the  betterment  of  life  insur- 
ance service.  It  is  all  for  the  welfare  of  policyholders.  The 
institution  of  life  insurance  is  fundamentally  a  cooperative  enter- 
prise and  in  the  main  is  being  conducted  on  the  purely  mutual 
or  cooperative  plan.  It  is  not  surprising,  therefore,  to  find  life 
insurance  companies  thinking  of  their  common  interests  and  pre- 
paring themselves  to  speak  for  their  policyholders  collectively 
rather  than  for  them  as  they  happen  to  be  grouped  in  the  several 
companies.  In  this  business  the  words  "rivalry"  and  "emulation" 
describe  our  strivings  with  each  other  more  accurately  than  the 
word  "competition." 

While  I  have  recited  a  number  of  objects  for  which  our  Asso- 
ciation was  formed,  I  am  not  unmindful  that  a  statement  of 
constitutional  "objects"  loses  interest  and  importance  in  a  dimin- 
ishing ratio  with  advance  in  years  of  an  association's  existence. 
We  then  look  at  the  work  which  has  been  done  and  the  spirit  which 
has  prevailed  rather  than  to  verbal  proclamations  of  purpose  or 
belief. 

New  Year  resolutions  made  by  a  young  man  may  be  worthy  of 
attention  and   perhaps  command  respect  even  though  he  is  not 
living  up   to   them,   while   similar   declarations   of  intent   coming 
from   a  man  in  middle  life  would  serve  but  to  brand   him   as 
a  hypocrite  if  they  failed  to  coincide  with  his  known  reputation 
and   habits   of   life.     Corporations   and   associations  likewise   de- 
velop characteristics  and  habits  through  a  long  period  of  exist- 
ence which  tend  to  make  their  declared  objects  and  purposes  of 
little  meaning.     Hence  it  is  that,  in  connection  with  stating  the 
professed  objects  of  the  Association  of  Life  Insurance  Presidents, 
I  have  taken  occasion  to  refer  to  the  field  it  has  actually  occupied 
and  the  work  it  has  really  done  in  the  past.     It  began,  and  has 
continued,  with  recognition  of  the  fact  that  right  action  among 
men  may  generally  be  determined  upon  by  finding  out  and  doing 
that  which  is  for  the  good  of  all.    And  by  the  same  token  wrong 
conduct  can  usually  be  avoided  by  refraining  from  doing  that 
which  is  intended  to  promote  the  interest  of  one  at  the  expense  of 
the  many.     In  other  words,  the  guiding  rule  has  been  to  promote 
common  welfare  as  against  individual  interest  where  the  claims 
seemed  to  conflict.     I  emphasize  this  because  it  seems  to  me  there 
is  no  principle  in  corporation  management  that,  in  the  temper 
of  modern  times,  is  so  in  need  of  being  thoroughly  understood  by 
corporation  managers.     While  corporations  were  brought  into  be- 
ing to  meet  the  need  for  cooperation  among  individuals  in  their 
business  activities,  we  have  learned  that  greed  did  not  become  a 
virtue  merely  because  it  put  on  a  cooperation  cloak.     President 
Lowell,  of  Harvard,  has  sounded  the  note  of  warning  in  his  recent 
book  on  Public  Opinion,  in  which  he  says:     "No  one  can  have 
observed  social  life  carefully  under  any  aspect  without  seeing  that 
cooperative    interests   have    in    some    measure    replaced    personal 


186  WORLD'S  INSURANCE  CONGRESS 

ones;  that  in  its  conscious  spirit  Western  civilization  has  become 
less  individualistic  .  .  .  This  is  among  the  dominant  notes  of  our 
time,  and  while  the  change  is  for  the  better,  .  .  .  that  very  fact 
whether  the  body  be  a  bank,  a  railroad  company  or  a  trade  union 
may  cover  with  a  gilding  of  altruism  what  is  after  all  only  co- 
operative selfishness." 

Officers  and  directors  of  life  insurance  companies  may,  for  prac- 
tical reasons,  be  compelled  to  regard  their  field  of  responsibility 
as  being  limited  to  the  interests  of  policyholders  in  the  company 
which  they  happen  to  represent,  but  this  is  not,  and  cannot  be, 
true  of  an  association  which  includes  many  companies  and  lays 
claim  to  being  representative  of  the  institution  of  life  insurance  as 
a  whole. 

It  is  interesting  to  note  that  civilization  has  been  marked  at  all 
stages  of  its  development  by  the  extent  to  which  the  rights  of  the 
individual  have  been  subordinated  to  the  common  rights  of  ever- 
enlarging  groups  and  alliances.  In  primeval  contests  for  supre- 
macy it  was  man  against  man.  Later  and  in  successive  order  it 
was  clan  against  clan,  tribe  against  tribe.  State  against  State  and, 
finally,  in  this  year  of  grace  1915,  it  is  nation  against  nation, 
wholly  unmindful  of  the  fact  that  in  every  case  the  superior  right 
rests  with  neither  of  the  warring  factions,  but  upon  the  interests 
of  humanity  in  general,  and  that  in  the  end  every  alliance,  whether 
it  be  family.  State,  nation  or  big  business  must  give  way  to  what 
is  best  for  the  world  at  large. 

It  has  been  suggested  that  the  chief  function  of  associations 
such  as  are  represented  on  the  program  here  to-day  is  to  dis- 
seminate among  the  people  reliable  and  trustworthy  information 
regarding  the  several  branches  of  business  they  represent  and  that 
in  doing  such  they  should  be  considered  insurance  universities. 
While  I  have  tried  to  show  on  behalf  of  the  one  I  speak  for  that 
it  has  done,  and  must  continue  to  do,  much  along  this  line.  I  would 
like  to  close  with  another  thought.  It  is  my  feeling  that  chief 
emphasis  should  be  given  to  the  important  part  these  associations 
play  in  the  education  of  their  own  members  regarding  what  their 
attitude  should  be  toward  each  other  and  in  relation  to  the  piib- 
lic.  One  of  their  most  important  functions  is  to  teach  their  mem- 
bers to  take  a  common  point  of  view  and  to  stand  for  common 
interests  as  against  the  interest  or  preferences  of  any  one  of  them. 
It  is  for  them  to  teach  practical  cooperation  by  showing  its  uses 
and  benefits;  to  inculcate  the  spirit  of  brotherhood  by  providing 
an  organization  in  which  it  must  be  the  guiding  principle  and  a 
place  where  it  can  be  exemplified : 

Age,  misstatement  of. 
Amortization  of  bond  values. 
Annual  reports. 
Ante-dating  policies. 
Board  contracts. 


WORLD'S  INSURANCE  CONGRESS        187 

Business  insurance. 

Cash  surrender  values. 

Codes,  insurance. 

Colleges,  life  insurance  training. 

Commissions,  agents'. 

Competition  in  life  insurance. 

Contiict  of  laws,  rulings,  etc. 

Conservation,  general. 

Contingency  reserve. 

Convention  blanks. 

Cooperative  advertising. 

Cost  of  new  business. 

Disability  benefits. 

Distribution  of  investments. 

Distribution  of  surplus. 

Dividend  accountings. 

Dividends,  nature  of. 

Emergency  loans  on  policies. 

Estimates,  by  life  insurance  agents. 

Examination  of  policyholders. 

Farm  mortgages  as  investments. 

Fitting  policy  to  policyholder. 

Forms  of  protest. 

Forms  of  release. 

Group  insurance. 

Guaranteed  dividend  policies. 

Income  policies. 

Insolvency. 

Insurable  Interest. 

Interest  rate  on  policy  loans. 

Interest  rates,  general. 

Investments. 

Land  credit  banks. 

Limitation  of  surplus. 

Limitations  on  expenses. 

Limitation  on  new  business. 

Medical  examinations. 

Medical  fees. 

Mortality  experience. 

Mortgage  loan  investments. 

Need  for  better  vital  statistics. 

Partnership  insurance. 

Permanent  disability  policy. 

Policy  forms  and  provisions. 

Policy  loan  problem. 

Premium  note  provisions. 

Railroad  investments. 

Rebating. 

Rural  credit  systems. 

Select  and  ultimate  valuation. 

Standard  policy  forms. 

Substandard   risks. 

Suicide. 

Surrender  and  loan  values. 


188       WORLD'S  INSURANCE  CONGRESS 

Systematic  training  of  agents. 
Twisting  policies. 
Unfair  advertisement. 
Unfair  competition. 
Valuation  of  policies. 
Warranty,  breach  of. 
Women  as  life  insurance  risks. 


NATIONAL   COUNCIL   OF   INSURANCE   FEDERATION 
EXECUTIVES 

By  Mark  T.  McKee 
Secretary  and  Treasurer 

Mr.  Chairman,  Members  of  the  Congress :  In  my  own  home  city, 
Detroit,  where  we  consider  life  is  worth  living  all  of  the  time,  and 
where  once  in  a  while  an  automobile  is  made,  we  have  a  maxim 
that  "the  shorter  the  spoke  the  lesser  the  tire."  It  is  my  per- 
sonal belief  that  this  applies  just  as  well  in  the  making  of  speeches 
as  it  does  in  the  making  of  automobiles,  and  I  have  endeavored 
to  carry  out  this  thought  in  the  paper  which  I  will  now  present. 

Insurance  organizations  are  not  of  recent  origin  as  is  shown 
by  the  number  and  character  of  those  who  are  participating  in 
the  events  of  the  World's  Insurance  Congress. 

Organizations  among  various  branches  of  insurance  have  sprung 
into  existence  from  year  to  year,  to  establish  good  business  prac- 
tices, to  determine  questions  of  ethics  and,  when  they  occur,  to 
adjust  differences  between  agent  and  company.  None  of  them, 
however,  has  met  with  much  success  in  important  legislative  mat- 
ters. In  fact,  no  organization  has  been  in  a  position  to  chal- 
lenge successfully  the  invasion  of  State  Insurance  into  a  dozen  or 
more  States. 

Not  until  one  important  branch  was  taken  over  by  the  State  of 
Ohio  and  all  the  other  lines  were  seriously  threatened,  did  the 
cooperation  of  all  classes  of  insurance  find  expression  in  the  In- 
surance Federation  idea.  As  this  idea  became  a  practical  and 
potential  fact  in  State  after  State,  there  presented  itself  the 
necessity  for  a  closer  unification  of  activities  and  a  standardization 
of  the  work  among  existing  Federations.  For  this  purpose  on 
May  25th  last,  in  Chicago,  the  National  Council  of  Insurance  Fed- 
eration Executives  was  organized  from  the  officers  and  govern- 
ing boards  of  the  various  States  Federations,  and  it  is  in  behalf 
of  this  movement  that  I  address  the  Congress  to-day. 

No  organization  has  an  economic  right  to  exist  that  does  not  fill 
a  crying  need,  nor  has  it  an  ethical  right  to  exist  if  it  does  not 
perform,  through  high  moral  purposes,  a  great  duty  to  the  public. 


WORLD'S  INSURANCE  CONGRESS       189 

In  view  of  these  basic  facts,  has  the  Federation  justified  its  ex- 
istence ? 

The  Insurance  Federation  was  formed  for  the  purpose  of  unit- 
ing and  welding  into  one  great,  fraternal  cooperative  and  protec- 
tive association,  the  many  thousand  insurance  representatives  and 
citizens  directly  and  indirectly  interested  in  the  insurance  busi- 
ness. Its  work  is  distinctive :  It  in  no  way  conflicts  with  the  pur- 
poses of  other  organizations,  but  it  works  hand  in  hand  with  them. 
The  interdependence  and  interrelationship  of  all  insurance  lines  is 
fully  recognized  in  the  Federation  idea.  It  was  the  outcome  of  a 
conviction  that  the  interests  of  the  policyholder,  agent  and  com- 
pany are  one,  and  in  doing  that  which  is  best  for  the  policyholder 
the  agent  and  company  are  doing  the  best  for  themselves.  It  is 
a  great  protective  movement  in  the  defense  of  the  interests  of  in- 
surance which  has  become  of  incalculable  importance  to  satisfy  a 
growing  economic  demand.  Through  constructive  publicity,  it 
opposes  all  that  is  harmful  and  vicious  in  legislative  matters. 

The  Federation  idea,  which  first  found  expression  in  the  form  of 
organization  in  Ohio,  came  too  late  in  that  state  to  save  the  casu- 
alty line,  but  it  had  a  salient  influence  in  checking  a  well  planned 
movement  to  make  serious  inroads  on  every  other  class  of  insur- 
ance. It  changed  the  entire  course  of  affairs  in  the  State  of  Mis- 
souri, where  a  State  Insurance  Fund  was  advocated  by  several 
members  of  an  important  Senate  Committee,  which  later  thor- 
oughly investigated  the  Ohio  State  plan  and  made  a  strong  ad- 
verse report.  Pennsylvania  found  in  the  Federation  a  tower  of 
strength  in  a  long  drawn  out  campaign,  resulting  in  the  enactment 
of  a  competitive  Workmen's  Compensation  Law.  Minnesota, 
through  its  Federation,  has  wonderfully  protected  the  interests  of 
the  fire,  casualty,  and  surety  lines  while  in  Iowa  its  work  was  re- 
warded with  pronounced  success  in  the  prevention  of  a  deeply  laid 
plan  to  substitute  a  State  Fund  similar  to  that  of  Ohio  for  the 
present  Workmen's  Compensation  Law.  In  the  same  State  the 
Anti-discrimination  Law,  affecting  fire  insurance  interests  in  a 
special  way,  was  successfully  carried  forward  by  the  Federation, 
although  other  organizations  had  tried  in  vain  to  bring  about 
the  same  result.  In  Illinois,  with  the  Superintendent  of  Insur- 
ance, ably  supported  by  the  State  administration,  the  Federation, 
through  a  widely  diversified  membership,  was  unsparing  in  its 
effort  to  bring  about  the  defeat  of  proposed  State  Insurance  and 
other  measures  directed  against  the  fire  insurance  business.  Indi- 
ana can  thank  the  Federation  movement  for  one  of  the  best  Work- 
men's Compensation  Laws  in  all  the  country.  It  was  a  strong 
united  eft'ort  that  saved  this  State  from  making  a  sad  economic 
blunder  like  Ohio,  West  Virginia  and  Washington.  The  States 
of  New  York,  Michigan  and  Kentucky  are  well  in  line  and  are 
doing  most  effective  work. 

It  would  seem  that  the  failure  of  the  State  Fire  Insurance  Fund 
covering  public  property  in  Wisconsin   for  the   past  ten  years 


190       WORLD'S  INSURANCE  CONGRESS 

would  open  the  eyes  of  the  law-making  bodies  of  the  country.  Gov- 
ernor Phillip  of  that  State  has  pronounced  it  a  failure  and  has 
asked  for  its  repeal.  The  Wisconsin  State  Life  Insurance  plan 
has  also  made  a  very  poor  showing.  At  the  end  of  three  years 
the  fund  had  only  311  policyholders,  100  of  which  were  students 
who  were  induced  to  patronize  the  Fund  in  the  interest  of  a  cer- 
tain memorial  which  would  benefit  by  it.  $219,000.00  of  insurance 
indemnity  is  all  that  is  now  represented,  whereas  the  people  of 
that  State  during  the  same  period  made  some  300.000  applica- 
tions, compared  with  311,  for  about  $200,000,000.00  of  regular  life 
insurance  in  companies  and  legalized  fraternal  organizations.  The 
foregoing  not  only  shows  how  inefficient  and  even  wrongful  is  the 
onward  march  of  State  Insurance,  but  it  also  clearly  indicates  that 
the  whole  structure  of  underwriting  is  threatened. 

The  North  Dakota  State  Hail  Insurance  Fund  has  an  unsatis- 
factory record  and  is  paying  indemnity  only  in  part  out  of  its  de- 
pleted Treasury.  The  Washington  scheme  of  AVorkmen's  Com- 
pensation has  been  condemned  by  both  employer  and  employee, 
while  in  AVest  Virginia  last  winter,  when  stability  and  solvency 
were  most  essential,  one  sub-division  of  the  State  Fund  became 
wholly  insolvent.  The  Ohio  plan,  which  is  a  sort  of  cross  be- 
tween mutual  and  self  insurance,  has  already  developed  short- 
comings of  a  pronounced  character.  The  employer  has  found  that 
there  is  a  dangerous,  unavoidable  open  liability  that  cannot  be 
covered  in  the  State  Fund,  and  that  the  present  partial  protection 
at  an  alleged  low  rate  is  often  followed  by  serious  penalties,  to 
make  up  for  the  inadequate  charge.  These  penalties,  being  very 
unpopular,  were  susperseded  on  July  first  by  a  rule  permitting 
an  increase,  during  any  six  months,  of  24  per  cent  in  the  premium 
charge.  Even  labor  in  Ohio  is  finally  waking  np  to  the  fact  that 
the  State  Fund  really  guarantees  nothing,  simply  paying  out 
money  as  long  as  it  lasts,  and  that  they  of  all  people  should  be 
in  favor  of  good  dependable  insurance.  Shall  we  allow  a  theory 
which,  so  far  as  tried,  has  been  found  wanting,  to  supersede  an 
institution  that  has  become  an  economic  necessity  and  has  stood 
the  test  of  time?  Should  the  mistaken  opinions  of  the  public  be 
allowed  to  blind  them  to  the  superiority  of  the  business  which  has 
commanded  some  of  the  best  intellect  and  effort  of  generations? 

Tlu'i-e  is  an  idea  prevalent  that  the  Company  and  its  represen- 
tatives should  be  eliminated,  and  that  certain  insurance  benefits 
should  be  administered  solely  by  the  State  and  at  the  expense 
of  the  taxpayer.  Is  there  any  valid  reason,  either  economic  or 
ethical,  Avhy  a  subsidy  from  the  State  Treasury  should  be  annu- 
ally set  aside  to  carry  on  the  insurance  business?  Just  as  well 
furnish  food  products  or  any  of  the  other  necessities  affecting  the 
whole  people.  No  argument  can  be  urged  in  favor  of  this  plan 
that  will  not  apply  with  equal  force  to  any  other  business.  The 
company,  with  its  capital,  surplus  and  reserve,  furnishes  the  sta- 
bility and  wide  distribution  of  risk  so  essential  to  sound  insur- 


WORLD'S  INSURANCE  CONGRESS  191 

ance.  Through  the  medium  of  its  agents  and  other  representa- 
tives, it  performs  a  service  to  the  Nation  in  the  protection  of  the 
individual  that  the  assured  cannot  well  do  without,  and  for  which 
the  well  informed  are  willing  to  pay. 

The  mission  of  the  Federation,  therefore,  is  to  educate  the  pub- 
lic through  intelligently  handled  publicity  and  to  awaken  our 
citizenship  to  the  dangers  of  present  day  tendencies.  It  is  the 
special  function  of  this  movement  to  turn  on  the  searchlight  of 
truth  so  that  the  policyholder,  office  holder  and  office  seeker  alike 
may  recognize  the  justice  of  our  cause.  The  insecurity  of  the 
country  to-day  is  in  the  rule  of  the  uninformed.  The  unenlight- 
ened mind,  warped  by  prejudice,  by  what  he  hears  and  sees  bu£ 
does  not  understand,  is  a  dangerous  factor  in  business  life.  Such 
men  find  their  way  into  the  legislative  halls  of  the  country  and 
join  hands  with  the  theorists,  until  the  whole  business  fabric,  as 
well  as  commercial  progress,  is  in  jeopardy.  There  is  an  immediate 
need  for  us  to  counteract  the  theories  and  fallacies  of  the  well- 
meaning,  but  misguided  citizen.  The  protective  idea  finds  its 
greatest  strength  in  educating  the  same  citizens  to  a  fair  and  a 
definite  understanding  of  proper  insurance  methods  in  giving  the 
best  possible  service  at  the  lowest  possible  cost  consistent  with  safe 
protection ;  in  informing  the  insurance  buyers  as  to  the  particular 
benefit  of  each  form  of  insurance  and  the  important  part  it  plays 
in  their  business  affairs  as  well  as  in  the  home;  in  making  more 
popular  the  business  of  underwriting  so  that  its  benefits  may  ex- 
tend more  generally  to  the  masses.  Under  such  conditions  it  will 
be  much  easier  to  widely  distribute  insurance  benefits. 

Through  education,  cooperation  and  organization,  strengthened 
by  intelligent  and  persistent  publicity,  the  movement  seeks  to  bring 
to  the  policyholder,  the  insurance  agent  and  the  insurance  com- 
panies a  fuller  realization  of  the  fact  that  they  have  a  common 
interest  to  foster,  as  well  as  to  protect  against  destructive  acts  and 
measures  both  public  and  private.  Those  engaged  in  every  class 
of  insurance  together  with  the  assured  are  represented  in  its  mem- 
bership. Each  has  equal  representation  on  the  Eecutive  Commit- 
tee, which  shapes  the  policies  and  directs  the  affairs  of  the  various 
State  organizations,  cooperating  with  the  National  Council.  The 
Federation  strongly  features  the  necessity  for  cooperation  with  the 
public  in  enacting  and  enforcing  just  and  beneficial  insurance 
laws. 

In  carrying  out  its  aim,  the  Federation  finds  its  most  potent 
strength  in  a  close  alliance  between  the  buyers  and  sellers  of  in- 
surance. This  will  result  as  a  matter  of  course  in  a  better  under- 
standing between  the  underwriting  profession  as  a  class  and  those 
who  are  in  public  positions,  who  can  so  easily  promote  or  retard 
business. 

A  Publicity  Bureau  conducted  in  the  interest  of  every  branch 
of  insurance  should  be  maintained.  We  need  to  have  the  whole- 
some facts  concerning  insurance  constantly  before  the  public.    No 


192       WORLD'S  INSURANCE  CONGRESS 

false  or  damaging  statements  or  note  of  discord  should  go  unchal- 
lenged, and  as  a  result  few,  if  any,  would  appear  in  print.  A  cam- 
paign for  a  wider  knowledge  and  a  more  definite  understanding 
of  the  insurance  business  should  be  extended  to  the  law-makers 
and  administrative  officers,  as  well  as  to  those  who  are  seeking 
official  preferment. 

The  movement  has  had  a  splendid  reflective  influence  on  the 
companies  and  agents,  arousing  a  greater  interest  and  pride  in 
what  is  now  the  second  most  important  business  in  the  country. 
Representing  as  it  does  the  insurance  business  in  its  entirety,  the 
position  of  the  Federation  is  greatly  strengthened  before  legis- 
lative bodies  and  executives,  not  only  giving  it  wider  authority, 
but  also  stripping  the  movement  of  any  appearance  of  individual 
self-interest.  Confining  itself  to  basic  questions  of  wide  general 
importance,  civic  organizations,  such  as  Chambers  of  Commerce 
and  Business  Clubs,  welcome  its  advocates  at  their  public  meet- 
ings as  speakers,  and  the  columns  of  the  newspapers  are  always 
open  for  such  insurance  news  as  may  be  of  general  interest.  As 
part  of  the  logical  educational  program  of  the  Federation,  such 
publicity,  supported  by  a  general  spirit  of  cooperation,  will  mate- 
rially help  insurance  to  gain  a  firmer  foothold  on  the  slippery  rock 
of  public  opinion. 

It  is  a  grave  undertaking,  the  magnitude  of  which  can  hardly 
be  comprehended,  to  suspend  the  underwriting  operations  of  almost 
a  half  hundred  companies  and  several  thousand  efficient  agents 
who  are  not  only  skilled  in  the  duty  of  safeguarding  the  interests 
of  the  employer  and  the  employee,  but  citizens  and  taxpayers  as 
well.  This  was  done  in  the  great  industrial  State  of  Ohio,  with 
a  view  to  placing  the  momentous  task  in  the  hands  of  a  politically 
appointed  self-regulated  Board  whose  tenure  of  office,  in  the  very 
nature  of  the  position,  can  only  be  temporary.  Although  as  far 
as  possible,  the  experience  and  precedence  developed  at  the  ex- 
pense of  the  insurance  companies  are  openly  appropriated  by  such 
Boards,  this  kind  of  supervision  is  most  inadequate  for  so  vast  and 
important  a  business  as  insurance.  The  State  is  wholly  out  of  its 
natural  element  under  such  conditions.  The  Federation  main- 
tains that  the  State  has  no  right  to  tax  a  citizen  for  support  and 
at  the  same  time  either  compete  with  him  or  wholly  confiscate  his 
business,  as  it  has  done  in  several  States.  It  also  takes  the  position 
that  the  State,  under  our  form  and  ideals  of  government,  has  no 
right  to  enter  into  any  kind  of  business  that  can  be  conducted  as 
well  or  better  by  the  citizen. 

How  many  law-makers  carefully  weigh  all  that  is  involved  in 
a  proposed  legislative  measure?  It  is  our  duty  and  privilege  to 
join  the  vast  army  of  insurance  workers  in  a  concerted  effort, 
to  see  that  insurance  is  properly  represented  in  the  law-making 
bodies  of  the  country.  In  its  entirety,  it  is  financially  the  second 
largest  business  of  the  Nation.  It  furnishes  more  than  a  quarter 
of  a  million  voters  from  the  ranks  of  its  agents,  and  probably  a 


WORLD'S  INSURANCE  CONGRESS  193 

half  million  more  from  the  Home  Offices.  Therefore,  many  more 
representatives  should  be  in  the  various  State  legislatures  and  in 
Congress  from  the  ranks  of  the  insurance  men.  As  a  rule,  in- 
surance men  are  among  those  who  are  most  prominent,  active  and 
influential  in  their  localities.  They  have  a  large  diversified  client- 
age among  the  leading  people  of  their  communities,  and  when  it 
is  undei-stood  that  the  votes  of  a  rapidly  increasing  citizenship 
made  up  of  insurance  workers  may  be  jeopardized  through  the 
passage  of  vicious  legislation,  it  will  operate  as  a  powerful  re- 
straining force  upon  those  who  regard  our  business  as  a  convenient 
stepping-stone  to  office. 

The  burden  of  exorbitant  tribute  in  the  form  of  taxes  is  increas- 
ing from  3'ear  to  year  until  the  total  exacted,  in  one  form  or  an- 
other, is  so  far  in  excess  of  the  actual  need  and  so  out  of  keeping 
with  the  basic  idea  of  insurance  taxation,  that  it  may  well  astound 
not  only  the  company  and  agent,  but  also  the  insurance  buyer. 
Nearly  twenty  millions  of  dollars  are  collected  annually  for  the 
purpose  of  supporting  the  insurance  department  of  the  various 
States.  It  requires  less  than  one-tenth  of  this  amount  to  liberally 
support  all  of  these  departments.  In  other  words,  more  than 
eighteen  millions  of  dollars  are  collected  yearly  in  excess  of 
the  amount  necessary  to  carry  out  the  purpose  for  which  the  taxes 
are  levied.  In  Ohio,  for  example,  less  than  $5.00  out  of  every 
$100.00  collected  is  used.  This  does  not  include  the  enormous 
unwarranted  tax  on  life  insurance  reserves,  the  taxes  on  the  prop- 
erty holdings  of  the  companies,  nor  the  agents'  license  fees.  These 
forms  of  legalized  extortion  are  increasing  annually  and  enlight- 
enment along  this  line  is  imperative,  bringing  home  to  the  policy- 
holder the  fact  that  he  in  the  end  must  stand  the  burden. 

A  movement  which  includes  in  its  membership  not  only  every 
class  of  insurance  activity,  but  also  the  insurance  buyer,  is  a  de- 
cided departure  from  the  ordinary.  Any  decisive  step,  whether 
right  or  wrong,  finds  its  critics,  and  the  Federation  has  not  been 
an  exception.  But  surely  whether  engaged  in  one  branch  of  in- 
surance or  the  other,  all  can  agree  that  it  is  important  that  the 
public  be  better  informed,  that  the  legislators  and  executives  of 
the  countr\^  have  a  proper  understanding  of  sound  honest  insur- 
ance methods.  The  insurance  fraternity  itself  needs  more  en- 
lightenment, a  stronger  vision  and  a  broader  perspective  in  this 
great  profession,  so  that  the  real  gravity  of  the  situation  which 
has  arisen  will  be  more  keenly  appreciated. 

In  returning  to  the  question  of  the  justification  of  the  Federa- 
tion's existence,  part  of  its  performance  of  duty  to  the  public  is 
only  just  started — that  of  educating  them  to  the  knowledge  that 
insurance  is  synonomous  with  common  sense  self  protection.  That 
the  movement  was  born  of  an  urgent  necessity  you  must  surely 
acknowledge.  That  it  has  already  accomplished  a  great  work  in 
checkmating  the  ruthless  measures  of  politicians  must  undoubt- 
edly be  granted.     If,  in  its  youth,  its  achievements  are  so  note- 


194       WORLD'S  INSURANCE  CONGRESS 

worthy,  does  not  its  full  growth  promise  the  complete  fulfillment 
of  its  ethical  and  economic  obligations? 


NATIONAL  ASSOCIATION  OF  CASUALTY  AND   SURETY 

AGENTS 

By  William  G.  Wilson 
Manager,  Aetna  Life  Insurance  Company 

Mr.  Chairman,  Ladies  and  Gentlemen :  In  rising  to  speak  before 
the  World's  Insurance  Congress,  it  is  a  pleasure  to  represent  the 
Association  by  which  I  am  accredited  and  is  an  honor  and  a 
privilege  quite  beyond  my  ability  amply  to  discharge. 

The  National  Association  of  Casualty  and  Surety  Agents — as 
its  name  implies — embraces  the  field  men  in  the  vast  and  varied 
departments  of  underwriting,  which  may  fairly  claim  to  include 
all  except  those  engaged  in  life,  fire  and  marine  insurance. 

This  Association's  existence  is  already  justified  by  its  accom- 
plishments. It  has  attracted  and  centered  the  loyal  support  of 
the  leading  minds  of  our  business — from  the  uttermost  limits  of 
the  United  States. 

It  has  been  accorded  a  degree  of  recognition  by  the  Insurance 
Commissioners  of  over  twenty  States  in  joint  meeting — quite  be- 
yond precedent — and  its  deliberations  have  been  so  constructive 
as  to  prompt  the  International  Association  of  Casualty  and  Surety 
Underwriters  (which  is  composed  of  the  company  executives)  to 
hold  their  last  two  annual  conventions  at  the  same  time  and  places ; 
and  upon  concurrent  action  these  thoroughly  representative  bodies 
have  appointed  a  Committee  of  four  members  from  each — to  act 
as  permanent  monitors  of  conciliation  and  cooperation. 

Our  Association  has  a  definite  mission  of  constructive  militant 
service. 

This  great  World's  Insurance  Congress  is  a  veritable  clearing 
house  for  the  ideas  which  actuate  the  Insurance  world. 

So  closely  interwoven  are  many  insurance  interests  that,  to 
avoid  trespass  upon  subjects  which  have  been  and  will  be  dis- 
cussed by  others,  I  shall  endeavor  to  limit  my  remarks  to  the 
dominant  impulse  out  of  which  has  grown  the  movement  espoused 
by  our  particular  Association. 

I  fear  no  contradiction  in  asserting  that  business  associations  all 
spring  primarily  from  the  instinct  of  self  preservation,  self  inter- 
est and  self  advancement. 

That  these  ends  may  be  attained  by  praiseworthy  and  laudable 
means  we  of  the  National  Association  of  Casualty  and  Surety 
Agents   believe. 

We  recognize  that  while  our  self  interest  is  of  direct  special 
concern  to  our  members  alone,  we  must  rely  upon  a  strong  and 


WORLD'S  INSURANCE  CONGRESS  195 

persuading  tie  to  bind  us  to  equally  impelling  self  interest  of 
other  but  co-related  groups  of  men. 

To  do  this  opens  a  field  so  vast  and  so  splendid  as  well  to  chal- 
lenge the  highest  ideals  and  activities  embodied  in  our  motto  of 
"Service." 

We  make  no  claim  to  a  sentimental  idealism  in  rendering 
service,  but  rather  do  we  realize  that  any  business  enterprise  best 
serves  itself  by  radiating  to  those  within  its  sphere  of  influence 
such  genuine  good  that  the  virtues  of  that  business  are  admitted, 
and  hostility  to  its  just  requirements  and  fair  compensation  to  its 
exponents  is  stilled.  The  tocsin  which  served  as  an  emergency 
call  into  being — for  our  Association — was  the  political  invasion 
both  competitive  and  regulatory  to  which  a  most  important  de- 
partment of  Casualty  Underwriting  has  been  subjected.  I  speak 
of  the  development  of  Employers'  Liability. 

From  time  immemorial  certain  pecuniary  obligations  have  at- 
tached to  an  employer  for  accidents  to  his  work  people.  Through 
a  progressive  process  in  step  with  advancing  industrial  condi- 
tions and  designed  to  better  distribute  the  burdens  of  unprevent- 
able  work  accidents,  a  basis  of  fixed  or  assured  obligation  to  each 
and  every  injured  has  been  evolved,  and  is  generally  known  as 
Workmen 's  Compensation. 

In  our  governmental  organization  in  most  States,  the  adoption 
of  civil  service  codes  has  operated  to  reduce  greatly  the  supply 
and  number  of  jobs  for  the  faithful  spoilsmen.  In  casting  about 
for  new  opportunities  to  meet  this  need,  the  political  place  hunt- 
ers seized  upon  this  "Workmen's  Compensation"  as  a  shibboleth, 
making  all  possible  claims  to  originality  and  discovery  in  seeking 
a  warrant  for  the  State  to  embark  in  the  insurance  business.  Two 
or  three  States  sought  to  make  state  insurance  compulsory,  while 
several  others — more  cautious — made  it  optional  and  competitive, 
although  by  far  the  greater  number  of  States  judiciously  kept 
"hands  off,"  apparently  realizing  that  our  government  is  de- 
signed to  legislate  for  and  not  to  strangle  or  annihilate  the  affairs 
of  the  people. 

Time  will  not  permit  a  discussion  of  the  merits  of  state  insur- 
ance, but  no  less  an  authority  than  Governor  Goethals  of  Panama, 
speaking  before  a  vast  audience  at  the  exposition  on  September  7th, 
said  that  "such  business  and  mercantile  activity  as  had  been 
forced  by  local  conditions  upon  our  government  in  the  Canal 
Zone  had  been  proclaimed  by  socialists  as  a  vindication  of  the 
efficiency  of  their  system!"  Governor  Goethals  said,  "Nothing 
could  be  further  from  the  truth,  as  such  administration  had  been 
strictly  autocratic  and  not  socialistic." 

This  Congress — impressive  by  itself — is  only  another  prism  in 
that  tower  of  intellectual  jewels  begotten  by  the  Panama-Pacific 
International  Exposition  and,  if  we  further  pursue  its  genesis, 
we  find  that  the  great  canal  itself  is  but  a  new  thing  which  will, 
in   a  very  short  space  of  time,  come  to  be  regarded  as  indispensable 


196       WORLD'S  INSURANCE  CONGRESS 

to  the  world's  commercial  progress.  I  hope  we  are  not  presumptu- 
ous in  drawing  an  analogy  between  the  Panama  Canal  and  the 
National  Association  of  Casualty  and  Surety  Agents. 

Both  serve  to  connect  large  bodies, — for  our  part  the  vast 
insuring  public  on  one  hand  and  the  multitude  of  insurance 
companies  on  the   other. 

It  has  been  clearly  shown  at  this  Congress  how  impossible  it 
would  be  to  carry  on  the  titanic  operations  of  modern  commercial 
life  without  the  ample  guarantees  of  insurance  and  suretyship 
offered  by  the  companies  we  represent.  , 

Our  interest  dictates  and  the  perpetuation  of  our  calling  depends 
upon  the  ability,  wisdom  and  care  by  which  we  maintain  the 
delicate  balance  of  accord  between  Insurer  and  Insured. 

One  of  the  monuments  to  our  profession  is  the  almost  limitless 
service  and  facility  afforded  by  insurance  men  for  bringing  to- 
gether the  insured,  with  his  manifold  and  often  intricate  require- 
ments, and  the  guarantors  with  compelling  need  for  preserving 
their  solvency  and  stability  by  just  and  adequate  rates. 

Our  calling  has,  in  many  unhappy  instances,  suffered  through 
the  infliction  upon  this  profession  of  those  men  who,  failing  else- 
where, turn  to  insurance  work  because  they  think  it  is  easy. 
If  every  such  man  had  enduring  success  I  have  yet  to  learn  his 
name. 

In  every  department  of  underwriting  endeavor  ability  of  first 
rank  is  in  constant  demand. 

The  prime  purpose  of  our  Association  is  to  safeguard  and  pre- 
serve the  opportunities  for  useful  and  lucrative  employment,  that 
men  of  character,  force  and  honesty  may  continue  in  its  ranks. 
Believing,  therefore,  that  insurance  agents  have  a  man's  work 
to  perform — this  Association  designs  to  adopt,  promote  and  ex- 
pand that  high  standard  of  service  which  senses  and  satisfies  the 
requirements  of  the  insurer  and  covers  with  the  shielding  panoply 
of  carefully  underwritten  contracts  or  bonds  those  transactions 
and  interests  which  constitute  the  great  body  of  world  business 
with  which  we  have  to  deal. 

If  we  can  attain  our  ideals  in  this  service,  we  hope  to  merit 
and  secure  for  ourselves  that  mutual  confidence  and  trust  which 
will  liken  us  to  the  great  channel  between  the  Panama  of  the 
Public  and  the  Colon  of  the  companies. 

In  practical  application  this  Association  seeks  to  instill  into  its 
membership  the  appreciation  of  a  threefold  character  of  duty  in- 
cumbent upon  every  Insurance  agent  worthy  of  the  name.  These 
sub-divisions  of  duty  are  Salesmanship,  Administration  and  Con- 
servation. 

Salesmanship  is  finished  when  the  order  is  secured.  At  this 
point  Administration  imposes  the  particular  task  of  intelligently 
meeting  the  insurance  needs  of  our  client  and  attending  to  them 
during  the  whole  course  of  the  undertaking. 

Conservation  involves  a  broad  conception  of  the  underwriting 


WORLD'S  INSURANCE  CONGRESS  197 

principles  and  the  actuarial  problems — the  repression  of  unjust  or 
frivolous  claims  and  the  inspection  and  correction  of  physical  de- 
fect either  in  persons  or  in  property. 

Unlike  those  associations  whose  chief  concern  is  to  improve  the 
methods  of  others,  we  believe  that  reform  in  this  branch — like 
charity — begins  at  home  and  to  square  the  practices  of  insurance 
negotiators  with  the  golden  rule — to  cultivate  in  the  public  mind 
an  appreciation  of  the  need,  economy  and  comfort  arising  from 
the  sense  of  security  in  being  fully  insured — and  to  protect  the 
company  as  well  as  the  insured  from  imposition,  thereby  showing 
cause  and  warrant  for  our  being. 

This  may  constitute  an  ambitious  program,  but  it  clearly  marks 
our  path  ahead. 

Composed  of  many  units,  all  having  in  one  way  or  another  a 
common  interest  in  disseminating  the  benefits  of  insurance — this 
World's  Congress  contains  the  crystallized  germ  of  a  mighty 
movement  for  the  education  of  the  public,  the  correction  of  evils 
in  the  business  and  the  preservation  of  this  work  for  all  time, 
if  we  will  but  join  to  share  and  bear  one  another's  burdens. 

I  thank  you  for  your  generous  attention. 


ASSOCIATION  OF  LIFE  INSURANCE  MEDICAL 
DIRECTORS 

By  Dr.  W.  W.  Beckett 
Medical  Director,  Pacific  Mutual  Life  Insurance  Company 

Mr.  Chairman  and  Ladies  and  Gentlemen:  I  presume  the  prin- 
cipal reason  for  asking  me  to  represent  this  Association  at  this 
time  is  because  I  am  the  only  member  of  the  Association  living  in 
California,  and  therefore  I  feel  a  little  like  the  young  man  at  a 
wedding  banquet,  who,  when  he  was  called  upon  to  make  a  speech, 
quietly  rested  his  hand  on  his  bride's  shoulder  and  said:  "Friends, 
I  want  you  to  know  that  this  has  been  forced  upon  me." 

I  will  preface  my  discussion  of  the  specific  questions  which  I 
am  called  upon  to  answer  with  a  brief  statement  of  the  chief  pur- 
poses of  the  Association  of  Life  Insurance  Medical  Directors  of 
America.  To  quote  the  Constitution  of  that  body,  "Its  object  is 
the  promotion  of  medical  science  as  applied  to  Life  Insurance  by 
personal  intercourse  of  its  members,  presentation  of  papers,  dis- 
cussions, and  .  .  .  the  advancement  of  the  general  interest  of  life 
insurance."  This  necessarily  involves  all  in  medical  science  and 
a  great  deal  in  collateral  science  which  may  have  a  bearing  on 
the  selection  of  risks.  The  investigations  from  this  standpoint  are 
constantly  becoming  broader  and  deeper,  with  results  that  have  a 
distinct  tendency  to-day  toward  "the  advancement  of  the  general 
interest  of  life  insurance." 


198  AVORLD'S  INSURANCE  CONGRESS 

In  considering  the  relation  of  the  Association  of  Medical  Direct- 
ors to  the  ethics  of  life  insurance,  we  must  glance  back  for  a  mo- 
ment to  the  period  before  the  introduction  of  reliable  mortality 
tables,  when  "graveyard  risks"  were  rife  and  an  element  of  gam- 
bling entered  into  every  life  insurance  contract  because  neither 
the  insured  nor  the  insurer  had  even  an  approximate  idea  of  the 
value  of  the  hazard  assumed.  Medico-actuarial  science  has  elim- 
inated haphazard  methods  of  selection  and  arbitrary  charges  for 
insurance.  The  tendency  is  constantly  toward  greater  precision 
in  these  respects,  and  greater  equity  in  the  contract.  The  Asso- 
ciation which  I  have  the  honor  to  represent  can  justly  claim  to 
have  played  an  important  part  in  bringing  about  these  conditions 
during  the  twenty-six  years  of  its  activity.  It  is  certain  that 
without  the  introduction  and  maintenance  of  a  strict  system  of  se- 
lection, life  insurance  could  not  enjoy  that  approval  of  public 
and  private  morality  which  is  the  very  essence  of  its  success- 
ful growth. 

It  goes  without  saying  that  the  special  function  of  the  medical 
director  is  a  fundamental  essential  of  life  insurance  economics. 
But  for  the  protective  selection  by  companies,  they  would  be 
subjected  to  the  utmost  adverse  effect  of  self -selection  by  appli- 
cants, the  mathematics  of  the  business  would  be  of  no  avail,  and, 
in  fact,  the  life  underwriting  would  be  impracticable. 

I  may  be  permitted  to  refer  briefly  to  the  influence  upon  social 
economics  exerted  by  the  activities  of  the  Association  of  Medical 
Directors.  Whilst  the  primary  purpose  of  its  labors  is  ''the  pro- 
motion of  medical  science  as  applied  to  life  insurance,"  the  re- 
sults of  its  investigations  are  made  freely  available  to  the  public. 
Its  contributions,  through  the  collective  experience  of  its  consti- 
tuent members,  to  the  general  fund  of  medical  knowledge,  espe- 
cially in  the  fields  of  biology,  neurology  and  pediatrics,  have  been 
of  inestimable  value  to  the  community  at  large. 

Perhaps  no  association  represented  in  this  convention  has  less 
scope  than  has  the  Association  of  Medical  Directors  for  an  ex- 
tension of  its  usefulness,  so  as  to  bring  about  better  understanding 
of  insurance,  and  its  service  among  the  masses.  The  studies  of 
our  association  are  necessarily  along  highly  technical  lines,  and 
its  publications  of  a  corresponding  character.  There  is,  however, 
a  medium  for  popular  education  available  to  it  and  one  which 
is  not  employed  to  any  considerable  extent.  I  refer  to  the  organs 
of  the  many  life  insurance  companies  which  monthly  reach  mil- 
lions of  policyholders  and  others  interested  in  life  insurance.  A 
better  understanding  of  the  medical  side  of  life  insurance  might 
be  conveyed  to  great  numbers  through  these  publications  with 
desirable  results  by  means  of  articles  couched  in  terms  compre- 
hensible by  the  layman. 

The  activities  of  medical  directors  are  essentially  directed  to- 
ward reduction  of  lo.sses  and,  consequently,  reduction  of  cost  to 
the  insured.     We  cannot,   however,  play  an  important  part  in 


WORLD'S  INSURANCE  CONGRESS  199 

reduction  of  the  expenses  of  management,  except  in  so  far  as  the 
economical  conduct  of  our  particular  departments  is  concerned. 
In  this  connection  I  may  add  that  there  is  no  department  of  a 
life  insurance  company  in  which  expert  and  efficient  service  is  of 
such  vital  consequence  as  it  is  in  the  Medical  Department.  Eco- 
nomies, as,  for  example,  through  the  curtailment  of  fees  for 
examinations,  may,  by  inducing  poor  service,  have  the  most  costly 
effect. 

In  the  matter  of  the  wider  distribution  of  the  benefits  of 
life  insurance  to  the  people  at  large,  the  work  of  the  Association 
of  Medical  Directors  is  a  potent  factor.  Its  investigations  and 
discussions  are  impartial  and  whilst  its  conclusions  point  at  times 
to  the  exclusion  of  certain  classes  of  risks,  at  others  they  point 
to  admission  where  it  had  formerly  been  denied.  In  fact,  the 
tendency  is  entirely  in  the  latter  direction.  With  the  develop- 
ment of  medico-actuarial  knowledge,  life  insurance  is  being  ex- 
tended to  impaired  lives  in  a  constantly  widening  manner.  Indeed, 
it  is  within  the  bounds  of  possibility  that  the  day  may  come  when 
the  medical  directors  and  the  actuary  will  be  able  to  determine 
upon  an  equitable  charge  and  equitable  conditions  for  the  insur- 
ance of  practically  every  kind  of  risk. 


NATIONAL   ASSOCIATION   OF  MUTUAL   INSURANCE 

COMPANIES 

By  J.   C,  Adderly 
Secretary,  Millers  Mutual   Casualty   Company 

The  Association  for  which  I  have  the  honor  to  speak  is  represen- 
tative of  the  oldest  successful  form  of  insurance  in  America.  The 
first  successful  American  insurance  company  was  the  Contribu- 
tionship  of  Philadelphia  which  was  organized  largely  through  the 
efforts  of  Benjamin  Franklin  prior  to  the  Revolutionary  War. 
This  company  is  still  in  existence  serving  its  policyholders  with 
increasing  efficiency  and  with  unquestioned  protection  from  year 
to  year.  It  is  indeed  fitting  in  a  Congress  of  all  insurance  interests 
that  the  Association  representing  the  oldest  form  of  American 
Insurance  should  be  participant. 

Form  of  Organization 

The  National  Association  of  Mutual  Insurance  Companies  is  the 
National  clearng  house  of  the  mutual  insurance  other  than  life. 
Its  members  are  grouped  into  three  classes  or  divisions,  namely : 

(1)  From  mutual  companies  or  associations, 

(2)  General  or  class  fire  insurance  mutuals,  and 

(3)  Mutual    casualty   insurance   companies. 

The  kind  or  class  of  insurance  business  written  by  each  of 


200       WORLD'S  INSURANCE  CONGRESS 

these  three  divisions  is  different.  They  are  held  together,  how- 
ever, in  a  National  Association  by  the  interest  in  the  common 
object  of  all  mutual  companies.  I  refer  to  the  prevention  of  the 
catastrophies  or  hazards  which  are  the  subject  of  the  insurance. 
This  with  mutual  companies  is  placed  even  prior  to  the  indemnifi- 
cation of  the  loss  as  the  object  of  greatest  importance. 

I 
Purpose  and  Object 

Wliile  the  prevention  of  the  loss  is  the  prime  object,  it  is  the 
manner  in  which  this  object  is  attained  that  is  identical  in  all 
mutual  insurance  organizations  and  is  the  binding  force  which: 
brings  all  together  in  a  common  association.  This  is  the  lesson 
of  "individual  responsibility."  Each  assured  in  such  companies 
must  be  taught  to  understand  that  his  individual  action  in  the 
care  of  persons  or  property  has  a  direct  bearing  both  financially 
and  otherwise  upon  his  neighbors  and  society  and  that  it  is  the 
sum  total  of  these  acts  of  his  and  of  other  individuals  which  con- 
stitutes "the  average"  upon  which  the  structure  of  insurance 
stands.  If  the  individual  sense  of  responsibility  is  high,  it  is  re- 
flected by  a  better  average.  It  has  been  the  persistent  teaching 
of  this  lesson  of  ' '  individual  responsibility, ' '  that  has  made  mutual 
insurance  one  of  the  greatest  factors  in  the  creation  of  the  highest 
standard  of  citizenship.  The  National  Association  of  Mutual  In- 
surance Companies  exists  for  the  purpose  of  aiding  by  collective 
thought  and  experience  in  teaching  this  great  lesson,  by  means  of 
which  the  prime  purpose  of  all  mutual  insurance  is  accomplished. 

Factors  Operating  against  IMutual  Insurance 

But  little  publicity  has  been  given  to  the  work  being  done  by 
Mutual  Insurance  or  by  the  National  Association  of  Mutual  Insur- 
ance Companies.     So  effectively  has  the  movement  spread,  how- 
ever, that  there  remains  no  State  to-day  which  has  not  felt  its 
beneficial  results.    Its  development  has  not  been  stimulated  by  the 
prospect  of  profit  or  proprietorship  upon  the  part  of  individuals 
or  groups  of  individuals,  which  incentives  have  been  the  stimulus 
of  practically  all  other  business  and  insurance  enterprises.     There 
is  no  profit  except  in  the  savings  which  accrue  to  every  participant 
in  proportion  to  the  economy  with  which  the  business  is  conducted 
and  the  effectiveness  of  its  loss  prevention  activities.     There  is  no 
ownership  other  than  the  collective  ownership  of  all  members.    Its 
extension  has  depended  only  upon  the  absorption  and  apprecia- 
tion of  a  fundamental  principle  unaided  by  the  personal  influence 
of  profit  participating  salesmanship.     It  has  operated  under  laws 
containing  limitations  and  restrictions  which  in  no  degree  apply 
to  present  day  needs  and  conditions.     Companies  which  are  ad- 
missibly sound  and  solvent  in  one  county,  district  or  State,  are 
prohibited    by    limitation   or   conflicting   provision    of   law    from 
serving  the  citizens  of  other  similar  communities. 


WORLD'S  INSURANCE  CONGRESS  201 

Extent  and  Influence 

In  spite  of  all  these  handicaps,  mutual  insurance  has  con- 
stantly increased  in  its  extent  and  influence.  The  Mutual  Fire 
Insurance  Organizations  of  the  United  States  collect  each  year 
approximately  15  per  cent  of  the  total  fire  insurance  premiums 
and  for  this  amount  of  premium  carry  30  per  cent  of  all  fire 
insurance  in  force.  "Within  the  State  of  Ohio  there  are  over 
250,000  mutual  insurance  policies  in  force.  In  the  State  of  Illinois 
there  are  more  than  300,000.  This  proportion  is  likewise  true  in 
respect  to  the  other  states.  To  even  the  casual  observer  mutual 
insurance  will  be  found  to  be  a  force  which  will  be  reckoned  with 
in  the  final  analysis  of  insurance  service.  The  individual  policy- 
holders of  mutual  insurance  companies  are  those  who  appreciate 
its  value  and  its  service.  It  is  with  these  individual  thousands 
that  the  strength  of  mutual  insurance  lies. 

Crucial  Period  of  Insurance 

Those  who  are  familiar  with  insurance  conditions  at  the  pres- 
ent time  are  aware  of  the  fact  that  there  exists  a  strong  prejudice 
against  the  form  of  insurance  conducted  by  capital  stock  com- 
panies. This  feeling  has  arisen  from  the  belief  that  the  premiums 
charged  are  exorbitant  and  the  profits  excessive.  In  some  instances 
this  prejudice  has  been  so  strong  as  to  take  the  form  of  a  demand 
that  the  State  take  over  the  entire  institution  of  insurance  under 
a  socialistically  conducted  insurance  plan  referred  to  as  "State 
insurance. ' '  This  plan  is  actually  nothing  more  or  less  than  mutual 
insurance  under  political  management  and  control.  The  demand 
for  such  form  of  insurance  often  comes  from  those  whose  risks 
are  not  up  to  the  standard  required  by  mutual  companies  and  who 
are  otherwise  unfitted  to  share  the  responsibilities  of  membership 
in  existing  mutual  organizations. 

If  any  mutual  insurance  organization  was  compelled  by  law 
to  accept  indiscriminatingly  all  applicants,  it  would  not  only  be 
unable  to  effect  the  economies  expected  but  would  soon  be  rele- 
gated to  the  list  of  failures.  It  will  be  idle,  however,  to  deny  that 
there  are  many  sincere,  earnest  advocates  of  such  a  plan  to  be 
applied  to  fire,  casualty  and  life  insurance.  In  certain  States 
it  is  already  being  experimented  with  and  has  taken  the  form 
of  a  monopoly  controlled  and  directed  by  the  political  power  of 
the  State. 

That  the  experience  of  the  next  ten  years  will  largely  deter- 
mine whether  insurance  is  to  remain  a  common  business  enter- 
prise in  which  any  may  engage  or  whether  it  will  be  entirely  taken 
over  by  the  State  in  the  form  of  a  monopoly  under  political  man- 
agement and  control,  and  subject  to  the  whims  and  fancies  of 
the  party  in  power,  is  the  opinion  of  many. 


202  WORLD'S  INSURANCE  CONGRESS 


The  Obligation  of  Mutual  Insurance 

Upon  mutual  insurance  there  has  fallen  an  obligation  which  it 
has  never  had  before.  In  all  the  lines  of  insurance  which  are 
applicable  to  the  mutual  principles,  it  must  set  the  standards  of 
insurance  protection  and  service.  The  cost  of  insurance  in  such 
mutual  insurance  companies  will  prove  the  truth  or  falsity  of  the 
many  charges  of  exorbitant  profits  of  stock  companies.  In  mak- 
ing comparisons,  however,  due  regard  must  be  taken  of  the  fact 
that  the  mutuals  only  insure  a  selected  and  constantly  inspected 
class  of  risks  and  the  individual  assured  gives  a  degree  of  coop- 
peration  which  is  not  possible  in  any  other  kind  of  company. 

If  the  rate  of  premium  for  any  kind  or  class  of  insurance 
seems  unduly  high,  the  assured  of  that  class  should  have  the 
opportunity  of  availing  themselves  of  mutual  insurance  in  an 
effort  to  improve  the  risk  and  decrease  the  cost.  If  the  applica- 
tion of  mutual  insurance  fails  to  improve  the  risk  and  decrease 
the  cost,  the  assured  will  undoubtedly  return  to  capital  stock  in- 
surance as  offering  the  means  for  safe  and  sure  protection  and 
without  complaint  as  to  cost.  This  would  remove  the  present 
complaint  as  to  excessive  and  exorbitant  rates  and  eliminate  en- 
tirelj^  the  only  excuse  'Which  has  ever  been  offered  as  a  justification 
of  the  State  usurping  the  rights  and  privileges  of  its  citizens  to 
engage  in  the  business  of  insurance  on  either  the  stock  insurance 
plan  or  the  cooperative  mutual  plan. 

The  result  of  my  observation  has  been  that  the  demand  for 
State  insurance  has  largely  originated  with  that  class  of  insurers 
having  excessive  hazards  which  they  are  unwilling  and  unable  to 
improve  or  control  and  who  have  wished  the  State  to  attempt  to 
do  for  them  that  which  they  are  unwilling  to  do  for  themselves — 
in  other  words,  they  desire  to  unload  upon  the  great  body  of  pru- 
dent insurers  the  burden  of  their  excessive  risks  and  at  the  same 
time  take  the  direction  and  control  from  the  hands  of  the  premium 
paj'^ers  in  whom  it  is  entirely  vested  by  mutual  insurance  and  place 
it  in  the  hands  of  the  political  party  in  power. 

The  inapplicability^  of  the  mutual  insurance  principle  under 
a  compulsory  system  to  all  persons  and  to  all  risks  regardless  of 
their  qualifications  is  appreciated  by  no  one  more  keenly  than  by 
the  individual  member  of  a  mutual  company.  To  my  mind,  no 
more  dangerous  experiment  can  be  made  under  our  form  of  gov- 
ernment, and  certainly  none  more  un-American  in  its  conception 
and  application,  than  the  experiment  of  state  insurance. 

Mutual  Insurance  Should  Be  Available  to  All 

There  will  be  none  who  will  contend  against  providing  abund- 
ant opportunity  to  any  cla.ss  of  insured  to  have  their  own  mutual 
insurance  company  in  order  to  prove  the  exact  cost  for  carrying 
their  risks  and  to  decrease  that  cost  wherever  possible.    That  such 


WORLD'S  INSURANCE  CONGRESS  203 

companies  should  be  subject  to  laws  providing  for  a  sufficiently- 
high  standard  of  solvency  that  would  amply  protect  both  the 
company  and  the  individual  members  is  also  manifest.  Essen- 
tial to  the  successful  operation  of  such  companies  is  the  privilege 
of  writing  the  kind  of  insurance  in  which  they  are  engaged  under 
the  proceeding  legal  conditions  at  such  places  as  the  risks  may 
be  located.  There  will  be  those  who  will  say  that  these  condi- 
tions and  opportunities  now  exist.  Their  existence  at  the  present 
time  is  largely  in  theory  and  not  in  fact.  The  laws  of  the  various 
States  differ  so  greatly  upon  the  subject  of  mutual  insurance  that 
it  is  utterly  impossible  for  a  mutual  company  incorporated  under 
the  laws  of  one  State  to  secure  legal  authorization  in  the  others. 
The  strength  of  the  protection  offered  and  the  solvency  of  the  com- 
pany are  given  little  consideration,  but  the  statutes  are  loaded 
with  minor  technical  requirements  and  conditions.  At  the  present 
moment  the  insurance  commissioner  of  one  State  is  denying  ad- 
mission to  one  of  the  oldest,  largest  and  strongest  of  mutual  insur- 
ance companies  in  America  upon  a  technicality  which  has  no  rela- 
tion to  the  fundamentals  involved.  There  has  been  no  denial  of 
the  fact  that  the  company  can  well  serve  the  citizens  of  the  state 
and  in  its  special  field  render  a  greater  service  at  a  far  less  cost 
than  it  is  possible  to  secure  from  any  other  source.  Just  as  long 
as  such  conditions  prevail  and  the  spirit  of  the  present  mutual 
laws  are  misinterpretated  and  thereby  mutual  insurance  is  denied 
to  those  who  desire  it,  there  will  continue  to  be  a  feeling  of  dis- 
satisfaction with  present  conditions,  that  will  lead  as  it  has  al- 
ready led  to  the  support  of  so  radical  a  step  as  "state  insurance.'* 

The  Necessary  Remedy 

Uniform  legislation  has  been  suggested  as  a  solution.  To  those 
who  are  familiar  with  the  subject  of  legislation  this  solution  is 
recognized  as  being  practically  impossible.  To  the  most  thought- 
ful students  among  the  mutual  insurance  companies,  Federal  su- 
pervision and  control  practically  appear  to  be  the  only  solution 
of  the  problem.  Under  such  a  system,  similar  in  operation  to 
the  control  and  supervision  of  Federal  Banks,  such  mutual  insur- 
ance companies  as  would  conform  to  a  high  and  safe  standard  of 
solvency,  as  would  be  provided  by  a  Federal  Act,  could  best  an- 
swer the  purpose  for  which  they  were  organized,  would  provide 
better  and  stronger  protection,  a  more  effective  and  better  safety 
and  prevention  service,  and  would  be  providing  the  practical 
means  for  which  any  class  of  assured  could  carry  its  own  risks  at 
actual  cost,  remove  for  all  time  the  demand  or  necessity  for  the 
individual  States  to  attempt  the  socialistic  experiment  of  state 
insurance. 

Under  such  conditions  and  regulations  the  entire  insurance 
institution  would  be  benefited  and  the  standard  of  each  individual 
risk  would  be  raised.    The  National  Association  of  Mutual  Insur- 


204       WORLD'S  INSURANCE  CONGRESS 

ance  Companies  pledges  itself  to  aid,  in  every  way,  the  upbuilding 
of  a  substantial  Insurance  edifice  which  will  best  serve  the  needs 
of  the  insuring  public  of  Avhich  their  membership  constitutes  so 
large  a  part. 


OPENING  ADDRESS  OF  THE  SPECIAL  CHAIRMAN 

Robert  New^ton  Lynch 
Vice  President,  San  Francisco  Chamber  of  Commerce 

Mr.  President  and  Gentlemen:  One  cannot  help  but  be  pro- 
foundly impressed  with  the  character  of  the  program  that  has 
been  prepared  for  this  body,  and  the  thing  that  is  most  re- 
markably impressive  is  the  wide  range  of  human  interest  which 
this  Congress  emphasizes  and  accentuates.  Probably  there  is  no 
principle  in  all  society  that  so  illustrates  the  solidarity  and  rela- 
tion of  people  to  one  another  than  the  insurance  idea.  To-day  we 
have  the  representatives  of  the  various  public  organizatons,  as 
well  as  those  of  the  highly  organized  corporations,  that  are  to 
speak  in  regard  to  their  relation  to  the  insurance  idea.  Perhaps 
it  may  be  said  that  insurance  has  furnished  the  light  which  has 
made  possible  not  only  voluntar>^  commercial  organization,  but  the 
highly  developed  organizations  extant  in  commercial  life.  It 
would  not  be  possible  for  people  to  get  together  as  they  do  if  it 
were  not  for  insurance  in  all  of  its  various  phases. 

It  may  be  said  that  this  program  is  speaking  to  a  much  larger 
audience  than  could  possibly  be  present,  physically,  in  this  hall. 
This  is  the  first  time  in  the  world's  history  when  so  many  phases 
of  insurance  in  its  relation  to  life  have  been  brought  together. 
It  probably  could  not  have  been  done  were  it  not  for  this  world's 
exposition,  and  therefore  there  are  some  who  express  the  hope 
that  growing  out  of  this  significant  occasion  there  may  come  a 
closer  relationship  between  the  various  ideas  represented  by  the 
many  insurance  organizations  that  are  spoken  of  in  the  program 
that  is  before  you. 

I  think  it  is  Emerson  who  says  "there  is  something  vastly- 
greater  in  the  man  of  ability  than  anything  which  he  ever  does — 
that  the  achievements  of  any  great  man  are  not  so  great  as  the 
man  himself;"  and  this  Congress  is  greater  than  any  association 
of  individuals,  and  it  is  hoped  that  its  significance,  through  the 
printed  reports  and  the  unique  opportunity  which  is  given  for  pub- 
licity, will  reach  far  out  and  profoundly  impress  all  classes  and 
elements  of  insurance  in  this  country^  and  throughout  the  world. 

I  am  very  glad  to  bring  to  you,  at  the  beginning,  the  greetings 
of  the  Chamber  of  Commerce  of  San  Francisco,  which  has  been 
greatly  interested  in  this  Congress  movement.  One  of  its  prom- 
inent members  has  given  much  devotion  and  service  in  bringing 


AVORLD'S  INSURANCE  CONGRESS  205 

this  meeting  together,  and  we  successfully  coordinating  the  various 
lines  and  bringing  them  to  our  attention. 


SOUTHERN  PACIFIC  COMPANY 

By  E.  0.  McCoRMiCK 
Vice  President 

Mr.  Chairman,  Ladies  and  Gentlemen :  If  you  will  permit  me, 
I  am  going  to  confine  myself  pretty  closely  to  a  paper  that  I  have 
prepared,  which  will  expedite  mattei*s  and  enable  me  to  make  myself 
understood  a  little  better.  You  will  all  be  proud  and  happy  to 
know  that  I  have  discovered  that  the  oldest  profession  on  earth  is 
the  insurance  profession. 

The  Bible  is  full  of  insurance  facts. 

The  first  life  policy  was  issued  to  Adam.  Adam  would  be  here 
yet  if  he  had  stuck  to  the  conditions  of  the  contract,  and  curbed 
his  appetite  for  apples. 

Noah  took  out  the  first  marine  insurance.  He  built  the  Ark  and 
found  it  a  good  policy. 

The  original  accident  insurance  was  issued  to  the  children  of 
Israel,  when  the  Lord  parted  the  Red  Sea  for  them  to  cross  over. 
No  doubt  Pharaoh  bitterly  regretted  that  he  was  not  covered  by 
the  same  accident  policy,  when  things  began  to  come  his  way. 

The  Bible  points  out  that  the  best  burglary  insurance  is  the 
policy  which  directs  the  insured  to  lay  up  his  treasures  in  Heaven, 
whether  neither  moth  nor  rust  will  corrupt  them,  nor  thieves 
break  through  and  steal. 

The  Bible  is  urgent  on  the  subject  of  fire  insurance  for  the 
future,  and  provides  an  excellent  policy  for  which  the  only  premium 
we  have  to  pay  is  reasonably  decent  conduct  toward  God  and  our 
fellow  men. 

For  the  benefit  of  the  insurance  companies  themselves,  the 
Bible  suggests  a  long  term  life  to  him  who  shall  do  honor  unto  his 
parents. 

Railroads  are  among  the  biggest  insurance  companies,  since  they 
undertake  to  insure  the  safe  and  speedy  transportation  of  pas- 
sengers and  freight  from  producing  to  consuming  points — to-day 
an  exceedingly  complex  problem,  requiring  an  intricate  network 
of  tracks,  with  a  myriad  of  appurtenances  in  the  way  of  freight 
and  passenger  stations,  machine  shops,  engine  houses,  living  quar* 
ters  for  maintenance  of  way  employees,  and  huge  office  buildings 
for  the  housing  of  armies  of  clerks  and  the  administrative  and 
executive  officers. 

The  great  transportation  company  which  I  have  the  honor  to 
represent  here  has  not  been  behind  any  corporation  in  earnest 
efforts  toward  the  prevention  of  fire,  accident,  and  disease. 


206       WORLD'S  INSURANCE  CONGRESS 

Southern  Pacific  built  the  first  steel  passenger  car,  in  1906. 

Among  first,  if  not  the  first,  to  adopt  steel  and  steel  underframe 
for  freight  equipment. 

Seventy  per  cent  of  Southern  Pacific  freight  equipment  is  steel 
or  steel  underframe. 

Among  first  to  install  automatic  block  signals. 

Has  more  mileage  equipped  with  automatic  block  signals  than 
any  other  railroad  in  the  world. 

First  to  adopt  the  train  indicator,  which  permits  employees  on 
one  train  to  identify  another  train  passed  or  met  on  the  road. 

Among  first  to  adopt  air  brake  and  automatic  coupler. 

Is  100  per  cent  perfect  in  compliance  with  all  safety  appliance 
regulations  both  Federal  and  State. 

Has  spent  several  hundred  million  dollars  in  replacing  primi- 
tive structural  imperfections — bridges,  roadway,  power,  equipment. 

Among  first  to  adopt  animated  audible  and  visible  signals  at 
public   highway   crossings. 

Among  first  to  inaugurate  efficiency  tests  of  train  and  engine- 
men. 

Five  thousand  eight  hundred  and  seventy-nine  efficiency  tests 
made  with  distant,  home,  and  train-order  signal,  train  and  en- 
ginemen  were  100  per  cent  or  perfect. 

First  to  supplement  warning  signals  at  highway  crossings  by 
making  observation  tests  on  automobiles,  teams  and  pedestrians 
to  see  if  they  regard  warnings. 

Instituted  educational  campaign  concerning  ' '  Stop !  Look ! 
Listen!" 

Maintains  a  Board  of  Examiners  composed  of  transportation  ex- 
perts, with  well-equipped  business  car,  who  travel  over  entire  road, 
examining  transportation  department  employees  on  their  familiar- 
ity with  rules  and  regulations. 

Among  first  to  erect  clubhouses  for  employees. 

Maintains  division,  district  and  central  Safety  Committees. 

Has  expended,  since  1912,  $208,000  in  adopting  8,737  sugges- 
tions advanced  by  Safety  Committees  composed  of  employees. 

In  last  25  years  214,000  people  have  been  killed  on  railroads  of 
United  States,  and  113,480  or  over  53  per  cent  were  trespassers. 

The  Pacific  system  of  the  Southern  Pacific  Company  comprises 
6,500  miles  of  railroad,  and  involves  the  maintenance  of  1,400  loco- 
motives, 1,800  passenger  cars,  and  37,000  freight  ears.  It  era- 
ploys  a  total  of  35,000  men. 

Upon  the  fineness  of  the  brain  and  muscle  of  its  employees  is 
primarily  dependent  the  good  quality  of  service  necessary  for  the 
successful  operation  of  the  road.  Given  a  careful,  competent  em- 
ployee, supplied  with  efficient  tools  and  directed  by  intelligent, 
experienced  officers,  excellent  service  is  bound  to  result.  But  the 
most  careful  supervision  and  the  most  effective  working  materials 
are  inevitably  wasted  when  a  high  physical  and  mental  standard 


WORLD'S  INSURANCE  CONGRESS  207 

is  not  demanded  of  the  men  composing  the  working  force  of  the 
road. 

Early  realizing  the  paramount  importance  of  maintaining  a 
high  standard  of  excellence  of  the  human  materials,  a  system  of 
elimination  was  perfected  to  govern  in  the  employment  of  men. 
With  few  exceptions,  for  the  purpose  of  determining  his  fitness  to 
perform  the  duties  which  are  assigned  to  him,  each  applicant  for 
employment  is  subjected  to  as  rigid  a  physical  examination  as  any 
insurance  company  would  subject  him  to  were  he  an  applicant  for 
a  policy.  The  unfit  are  rejected — and  they  are  few,  because  with 
a  full  knowledge  of  the  requirements  the  unfit  do  not  apply. 

To  minimize  the  chance  of  a  misunderstanding  of  audible  and 
visible  signals  used  in  train  operation,  the  physical  examination  of 
those  having  to  do  with  the  movement  of  trains  includes,  at  the 
time  of  employment  and  periodically  thereafter,  exhaustive  tests 
of  the  eye  and  ear. 

Of  the  total  number  of  men  examined  for  transportation  serv- 
ice about  six  per  cent  are  rejected;  in  other  departments  about 
four  and  one-half  per  cent. 

This  physical  examination  system  required  the  services  of  com- 
petent physicians  and  surgeons,  who,  thus  becoming  identified 
with  the  company,  were  called  upon  to  treat  employees  who  were 
injured  or  contracted  illnesses  during  their  period  of  service. 

With  the  growth  of  the  railroad  an  increasing  need  of  a  speci- 
fic organization  to  direct  the  work  of  the  physicians  became  evi- 
dent, resulting  in  the  appointment  of  a  chief  surgeon  and  the 
gradual  upbuilding  of  the  new,  elaborate  and  complete  system 
of  emergency  or  first  aid  stations,  space  in  prominent  hospitals 
at  such  points  as  Ogden,  Portland,  Los  Angeles  and  El  Paso,  and 
our  own  magnificent  and  highly  efficient  hospital  at  San  Francisco. 

Connected  with  this  department  on  June  30th,  1915,  there  was 
a  total  of  364  physicians  and  190  other  employees,  48  of  whom 
were  graduate  nurses.  There  are  11  emergency  hospitals.  The 
total  cost  of  the  service  for  the  year  ended  June  30th,  1915,  was 
$295,402,  which  covers  hospital  care,  medical  and  surgical  treat- 
ment of  employees  at  hospitals,  surgeons'  offices,  and  at  patients* 
homes;  medical  and  surgical  dressings,  artificial  limbs  and  appli- 
ances. All  this  for  the  benefit  of  employees  or  patrons,  constitut- 
ing the  Southern  Pacific's  contribution  to  the  life  insurance 
cause. 

To  maintain  the  standard  of  excellence  produced  by  the  scientific 
selection  of  men,  a  judicious  system  of  discipline  is  necessary. 
For  nineteen  years  Southern  Pacific  transportation  department 
employees  have  been  subject  to  what  is  known  as  the  Brown  sys- 
tem, which  prescribes  the  impersonal  administration  of  discipline 
by  record,  and  prevents  loss  of  time  and  wages  of  employees  and 
consequent  possible  suffering  of  those  who  may  be  dependent  on 
their  earnings.    This  is  accomplished  by  the  assessment  of  demerits, 


20S  WORLD'S  INSmANCE  CONGRESS 

after  careful  investigation,  stated  periods  of  good  conduct  being 
specified  as  necessary  for  the  removal  of  the  demerits  from  the 
record. 

Under  this  system  each  man  can  work  with  the  knowledge  that 
the  excellence  of  his  record,  the  pi-ospect  of  his  continued  employ- 
ment, his  promotion  and  tinal  success,  depend  on  his  own  good 
conduct  and  exertions.  The  most  efficient  men  will  be  encouraged, 
developed,  benetited  and  retained:  those  who  prove  unfit  for  safe 
railroad  operation  will  be  dismissed. 

To  encourage  longevity  of  service,  loyalty  to  the  company,  and 
to  provide  recompense  for  these  qualities,  we  maintain  a  pension 
system,  which  provides  for  the  retirement  of  all  employees  who 
have  attained  the  age  of  seventy  years  and  have  been  continuously 
in  the  service  twenty  years  or  more;  for  the  retirement  of  in- 
capacitated employees  sixty-one  years  old  who  have  been  con- 
tinually in  service  twenty  years  or  more :  and  for  the  retirement 
of  employees  who  have  been  continuously  in  the  sen-ice  twenty- 
five  years  or  more  and  have  become  permanently  disabled. 

The  pension  allowance  is,  for  each  year  of  service  one  per  cent 
of  the  average  monthly  salary  received  for  the  ten  years  preceding 
retirement. 

The  Southern  Pacific  Company  bears  the  entire  expense  for 
benefit  and  the  operation  of  the  department.  For  the  fiscal  year 
ended  June  30th.  1915.  the  total  expenditure  was  $282,000.  and 
on  September  16th.  fifty-one  more  employees  were  retired  from 
active  sers'ice  to  enjoy  the  benefit  of  their  years  of  faithful  sel•^•ioe. 

The  pension  system  has  done  much  to  engender  among  the  em- 
ployees a  desire*  to  render  such  service  as  will  permit  their  con- 
tinued employment  and  this  feeling  in  itself  redounds  not  alone 
to  the  benefit  of  the  company  and  the  employees,  but  to  the  patrons 
of  the  company  through  the  more  efficient  and  safe  operation  which 
it  brings  about. 

As  with  the  supervision  of  its  employees,  the  efforts  of  the 
Southern  Pacific  have  constantly  and  consistently  been  directed 
to  the  improvement  of  its  equipment— the  tools  for  turning  out  its 
product,  transrportatian. 

The  gravity  of  several  accidents  on  various  railroads  some  years 
ago.  which  involved  the  loss  of  human  lives,  demonstrated  the 
crying  need  of  a  passenger  car  that  would  provide  the  maximum 
of  protection  to  its  occupants  under  all  conditions.  Wood,  the  ma- 
terial that  was  universally  used  until  the  year  1906,  had  proven 
to  be  a  dangerous  factor  in  cases  of  accident.  It  splintered  badly 
under  sudden  enormous  stress,  and  was  highly  inflammable. 

The  ingenuity  of  the  motive  power  and  transportation  depart- 
ment experts  of  the  Southern  Pacific  was  responsible  for  the  pres- 
ent steel  raUwau  car,  which  has  solved  that  perplexing  problem. 
The  Southern  Pacific  has  the  distinction  of  having  built  in  its 
Sacramento  shops  in  the  year  1906  the  first  steel  passenger  car  in 
railwav  historj'. 


WORLD'S  INSURANCE  CONGRESS  209 

Since  that  time  all  new  passenger  equipment  built  or  purchased 
by  our  company  has  been  of  steel  construction,  and  wood  as  a 
material  for  railroad  passenger  car  building  is  gradually  be- 
coming a  thing  of  the  past. 

We  were  among  the  first  to  realize  the  untold  advantages  of 
the  automatic  block  signal,  with  the  result  that  to-day  we  have 
more  mileage  equipped  with  automatic  block  signals  than  any 
other  railroad  in  the  world. 

These  two  items  are  typical  of  the  work  the  railroads  are  doing 
to  further  the  insurance  cause. 

The  motto  which  is  everywhere  displayed  on  the  properties  of 
the  Southern  Pacific  is  "Safety  First,"  and  that  motto  means 
something  beside  the  prevention  of  collisions,  derailments,  ex- 
plosions and  other  terrible  catastrophes  of  like  nature. 

We  are  as  profoundly  interested  in  protecting  the  public  health 
as  we  are  in  protecting  the  lives  and  limbs  of  our  passengers. 
This  care  extends  to  minute  particulars.  For  instance,  look  at 
the  hand  rests  on  your  seat  the  next  time  you  ride  in  one  of  our 
cars.  The  surface  is  perfectly  plain  and  smooth.  They  used  to 
ornament  hand  rests  with  stamped  decorations.  We  found  that 
these  decorations,  where  a  diseased  person's  hands  had  rested, 
might  afford  lurking-places  for  contagion — so  ornamentation  had 
to  go.  As  between  prettiness  and  sanitation,  we  chose  "Safety 
First." 

You  may  have  noticed  that  the  metal  sills  on  our  car  windows 
are  very  narrow.  You  can't  find  room  to  rest  your  arm  or  to 
lay  down  a  package  or  even  to  put  an  orange  peel  or  a  banana 
skin.  That  is  the  reason  the  sills  are  built  that  way.  We  didn't 
want  sick  or  infected  passengers  to  leave  disease  germs  on  the 
window  sills  for  well  passengers  to  come  in  contact  with.  Again, 
"Safety  First." 

These  may  seem  small  matters,  and  that  is  why  I  call  your 
attention  to  them.  It  is  reasonable  to  suppose  that  a  company 
which  pays  such  careful  and  unremitting  attention  to  small  de- 
tails and  small  safety  devices  will  not  neglect  the  big  and  obvious 
things. 

It  is  just  this  constant  care  and  vigilance  in  small  matters  and 
this  constant  watchfulness  and  anxiety  to  make  progress  in  health 
insurance  and  sanitation  and  in  prevention  of  infection  and  dis- 
ease, as  well  as  of  accidents,  that  makes  travel  on  all  the  great 
railroads   so    comfortable   and   safe. 

Naturally  the  car  with  which  the  railroads  guard  the  health 
of  passengers  is  reflected  in  better  health  conditions  all  over  the 
country,  for  it  is  evident  that,  if  the  railroad  cars  were  permitted 
to  be  infection-carriers  among  a  people  who  travel  so  frequently 
as  do  the  people  of  the  United  States,  diseases  would  be  spread 
from  one  end  of  the  land  to  the  other.  In  five  years  every  health 
and  life  insurance  company  in  America  would  be  on  the  road 


210  WORLD'S  INSURANCE  CONGRESS 

to  bankruptcy  if  the  railroads  neglected  the  sanitary  precautions 
which  make  travel  healthfully  safe. 

Every  device  that  promotes  the  safety  of  railroad  employees 
and  of  passengers  is  insurance  for  the  already  insured  and  in- 
creased protection  for  the  insurance  companies  themselves  is  pro- 
vided. 

In  our  efforts  to  benefit  ourselves  and  to  add  to  our  profits  by 
eliminating  the  losses  of  accidents  and  sickness,  we  are  compelled 
perforce  to  do  a  great  and  useful  work  of  incidental  protection 
for  the  whole  people  of  the  country. 

Endeavoring  primarily  to  increase  our  commercial  profits,  we 
find  ourselves,  as  a  necessary  corollary,  doing  a  gigantic  humani- 
tarian service  to  everybody  else. 

And  since  the  railroad  man  is  a  human  being,  with  passions 
and  emotions  and  sympathies  like  those  of  other  men,  I  need  not 
tell  you  that  the  knowledge  that  we  can  do  all  this  good,  and 
can  confer  and  do  confer  all  these  benefits  upon  our  brother  men 
and  sister  women,  is  very  grateful  and  pleasant  to  us,  and  makes 
the  day's  work  happier  and  the  night's  rest  sweeter  to  every  rail- 
road man  who  is  worthy  the  badge  of  our  honorable  and  useful 
profession. 

I  have  spoken  of  a  few  sanitary  precautions  we  have  provided 
and  I  could  much  more  than  fill  my  time  with  a  bare  catalogue 
of  similar  preventative  insurance  measures  we  have  put  in  force, 
as  well  as  of  others  that  are  as  yet  in  embryo. 

For  example,  fruit  handling :  we  protect  the  public  health  mark- 
edly by  our  system  of  disinfecting  the  cars  of  the  Pacific  Fruit 
express.  There  are  no  disease  germs  distributed  by  the  fruit 
which  goes  in  such  enormous  quantities  from  this  coast  to  the  con- 
sumers in  other  States. 

Constant  and  careful  attention  to  little  things  is  the  price  of 
human  safety.  It  is  the  little  things  that  set  traps  for  us  at 
every  turn.  The  bacillus,  which  can  only  be  seen  with  a  powerful 
microscope,  is  many  times  more  dangerous  than  a  lion  or  a  tiger. 
The  mosquito,  with  a  malaria  germ  ready  for  action,  is  far  more 
dangerous  than  a  rattlesnake.  A  cloud  of  dust  may  be  as  deadly 
as  a  shower  of  bombs. 

Once  man  feared  and  worshipped  the  big  things.  His  gods 
and  devils  were  the  sun  and  moon  and  stars,  the  lightning, 
the  thunder,  the  storm;  now  science  has  taught  us  to  beware  of 
the  infinitesimal— the  germ,  the  infected  speck  of  dust,  the  things 
that  float  unseen  on  Mnngs  of  death. 

Against  these  enemies  of  health  and  life  the  railroads  wage  in- 
cessant warfare.  Like  all  other  broadminded  business  concerns, 
the  railroads  have  learned  that  the  best  business  rule  in  the  world 
is  the  golden  rule ;  that  the  most  profitable  commercialism  is  hu- 
manitarian commercialism ;  that  the  welfare  of  the  treasury  is  in- 
timately and  necessarily  bound  up  with  the  welfare  of  employees 
and  patrons. 


WORLD'S  INSURANCE  CONGRESS       211 

I  think  that  any  one  who  intelligently  observes  contemporary 
life  must  be  powerfully  impressed  by  the  willingness  and  anxiety 
of  the  great  railroad  managers  to  serve  well  their  customers  and 
to  benefit  the  country. 

That  this  quickened  and  increased  regard  for  public  welfare 
will  be  met  by  equal  regard  for  railroads'  stockholders'  welfare — 
and  hostile  and  hampering  legislation,  villification,  abuse  and 
slander  of  railroad  men  lessened,  I  am  sure,  rendering  the  legiti- 
mate investor  less  afraid  to  put  his  money  into  the  construction 
and  betterment  of  the  transportation  lines,  upon  which  the  pros- 
perity of  all  business  and  every  citizen  fundamentally  depends. 

The  great  insurance  companies  are  the  heaviest  investors  in 
railroad  securities.  For  that  reason  every  insured  person  is  vitally 
interested  in  the  financial  welfare  of  the  railroads.  In  a  true 
sense,  every  insured  person  is  a  stockholder  in  railroads.  There- 
fore, every  insured  person  should  do  all  he  can  to  dissipate  foolish 
and  hurtful  hostility  to  legitimate  railroad  enterprises. 

Our  country  has  greatly  suffered  from  the  hysteria  of  the  past 
decade,  and  it  will  continue  to  suffer  until  sanity  and  good  sense 
prevail. 

Let  each  one  of  us,  as  a  good  citizen  should,  do  his  best  to 
bring  about  a  period  of  more  good-will,  of  more  fair  play,  of  less 
slander,  less  jealousy,  and  less  hostility,  towards  honest  invest- 
ment and  honest  business. 

Let  the  motto  of  the  people,  when  considering  public  matters, 
be  the  motto  of  the  great  corporation  I  am  proud  to  serve— 
"Safety  First." 


LIFE  EXTENSION  INSTITUTE,  INCORPORATED 

By  E.  E.  Rittenhouse 
President 

It  would  take  hours  to  describe  the  beneficent  influence  which 
the  great  institution  of  insurance  has  exercised  in  the  develop- 
ment of  modern  civilization. 

We  know  of  its  direct  benefits;  we  know  how  it  has  encour- 
aged thrift;  we  know  of  the  immense  volume  of  money  it  is 
sending  out  in  a  steady  stream  to  those  who  have  suffered  loss; 
we  know  that  by  distributing  its  vast  reserves,  in  investments,  in 
bonds  and  mortgages,  it  is  helping  to  build  schools,  roads,  streets 
and  other  public  works,  and  railroads,  trolley  lines,  business  build- 
ings and  so  on,  and  that  through  loans  it  is  helping  the  farmer 
and  the  business  men  to  enlarge  and  advance  their  enterprises. 
We  know  that  insurance  money  reaches  in  one  form  or  another 
every  hamlet  in  the  land  and  a  vast  number  of  homes.  We 
know   that   the   institution   of   insurance   is   a   mighty   factor  in 


212       WORLD'S  INSURANCE  CONGRESS 

developing  the  commerce  and  the  resources  of  our  country,  and 
that  its  popularity  among  the  people  indicates  that  its  service  to 
society  is  generally  appreciated.  But  how  many  realize  the  im- 
mense benefit  it  has  bestowed  upon  humanity  by  suggestion — by 
indirectly  influencing  individuals  and  other  organizations  to  en- 
gage in  some  phase  of  the  great  work  of  human  betterment? 

Much  of  the  inspiration  that  has  produced  the  rapid  growth 
of  the  general  welfare  activities  in  America  came  from  the  ex- 
traordinary success  of  the  institution  of  insurance.  Its  lessons 
are  largely  responsible  for  the  marked  increase  in  mutual  benefit 
plans  now  so  generally  adopted  by  social  organizations  and  by 
large  employers  of  men  and  women. 

An  example  of  the  constructive  influence  of  life  insurance  in 
encouraging  the  growth  of  big  ideas  for  the  benefit  of  mankind  is 
found  in  the  Institute  with  which  I  have  the  honor  to  be  con- 
nected. 

The  Life  Extension  Institute  was  neither  designed,  organized, 
nor  financed  by  life  insurance  interests  or  companies,  nor  is  it 
managed  or  controlled  by  them.  And  yet  the  institution  of  life 
insurance  is  responsible  for  the  inspiration  which  induced  a  large 
policyholder,  Mr.  Harold  A.  Ley,  of  Springfield,  Mass.,  to  design 
this  unique  human  service  institution  to  help  prolong  the  useful 
years  of  life  and  to  make  them  more  livable. 

Prior  to  the  year  1909  the  insurance  companies  gave  little  or 
no  attention  to  the  conservation  of  the  health  of  policyholders 
nor  did  they  take  any  special  interest  in  public  health  matters. 
About  that  time,  Irving  Fisher,  Professor  of  Political  Economy 
at  Yale,  conceived  the  idea  that  life  insurance  ought  to  combine 
and  contribute  a  sum  of  money  annually  to  assist  in  the  educa- 
tion of  the  public  in  the  laws  of  healthful  living,  both  as  a  gen- 
eral contribution  to  human  welfare  and  as  a  business  investment 
in  reducing  the  mortality  rate. 

While  the  combined  companies  could  not  see  the  wisdom  of 
providing  such  a  fund,  the  President's  Association  did  become 
interested  and  gave  the  general  movement  moral  support.  That 
year  (1909)  two  companies  took  up  the  work  actively  along  dif- 
ferent lines,  one  with  which  I  was  connected  offering  free  health 
examinations  and  an  educational  plan,  and  the  other  operating  on 
a  large  scale  introduced  both  an  educational  and  a  nursing  system. 

Since  that  time  twelve  or  fifteen  other  companies  have  entered 
the  field  to  a  greater  or  less  extent,  their  activities  ranging  from 
the  occasional  distribution  of  literature  to  the  offering  of  free  ex- 
aminations. The  encouragement  given  the  general  health  con- 
servation movement  by  the  favorable  attitude  of  the  bulk  of  the 
companies  has  materially  assisted  in  stimulating  interest  in  offi- 
cial and  unofficial  health  activities.  In  time  this  help  is  bound 
to  increase  as  the  companies  gain  experience. 

Mr.  Ley  had  become  keenly  interested  in  this  subject.  A  cal- 
culation of  the  financial  saving  from  the  prolongation  of  a  life, 


WORLD'S  INSURANCE  CONGRESS  213 

figured  on  the  basis  of  his  own  policies,  convinced  him  that  periodic 
health  examinations  would  not  only  be  a  good  thing  for  humanity 
in  general,  but  for  life  insurance  companies  and  others  influencing 
large  bodies  of  people.  He  desired  to  lay  the  foundation  of  a 
permanent  organization  that  would  develop  and  grow  and  en- 
dure for  all  time  and  become  a  mighty  force  in  conserving  the 
health  and  happiness  of  the  people.  He  was  anxious  to  render 
practical  assistance.  It  was  not  enough  to  tell  people  what  to 
do,  we  must  show  them  what  to  do. 

The  Institute  was,  therefore,  designed  as  a  public  service  in- 
stitution on  a  self-supporting  plan,  supplying  at  low  rates  health 
examinations  and  educational  service — any  profits  accruing  above 
a  moderate  return  on  the  original  outlay  to  be  used  to  further 
philanthropic  effort  by  the  Institute.  

Professor  Fisher  organized  a  Hygiene  Reference  Board  of 
nearly  100  members,  of  which  he  is  Chairman,  to  whom  all  im- 
portant health  announcements  are  referred  before  publication. 
This  board  consists  of  many  men  of  world-wide  eminence  in  the 
various  fields  of  human  betterment.  Among  them  are  Surgeon 
General  Wm.  C.  Gorgas  of  the  Army,  Surgeon  General  Rupert 
Blue  of  the  United  States  Public  Health  Service,  Dr.  Alexander 
Graham  Bell,  David  Starr  Jordan,  Dr.  Harvey  W.  Wiley,  Dr.  W. 
A.  Evans,  Dr.  Luther  Gulick,  Dr.  Victor  C.  Vaughan,  Professor 
M.  J.  Rosenau  of  Harvard  University,  Professor  William  T. 
Sedgwick,  and  Dr.  William  J.  Mayo,  ex-President  of  the  American 
Medical  Association. 

Former  President  Taft  became  Chairman  of  the  board  of  direc- 
tors. As  a  result  of  his  observation  of  the  success  of  modern 
methods  in  fighting  disease  in  the  insular  possessions,  his  interest 
in  this  work  is  very  keen.  Among  the  prominent  business  men  on 
this  board  are  Frank  A.  Vanderlip,  Charles  H.  Sabin  and  Robert 
W.  de  Forest.  Dr.  Eugene  L.  Fisk  was  made  Director  of  Hygiene 
and  the  speaker  became  President. 

The  intentions  of  the  organizers  may  be  summed  up  as  follows: 

1.  To  establish  and  maintain  a  central  institute  of  national 
scope  devoted  to  the  science  of  disease  prevention  supported  by 
a  large  board  of  recognized  authorities  in  the  various  fields  of 
health  and  life  conservation. 

2.  To  provide  thus  a  responsible  and  authoriative  source  from 
which  the  public  and  the  medical  profession  may  draw  knowledge 
and  inspiration  in  the  great  war  of  civilization  against  needless 
sickness  and  premature  death. 

3.  To  give  especial  attention  to  the  teaching  of  the  rules  of  per- 
sonal hygiene  or  healthful  living  in  order  that  not  only  the  rav- 
ages of  communicable  disease  may  be  stayed,  but  that  the  increas- 
ing waste  of  vitality  and  human  life  from  the  chronic  diseases  may 
be   checked. 

4.  To  direct  its  efforts  not  only  to  the  prevention  of  disease,  but 
to   its  early  discovery.     For  this  purpose  to  urge  and  provide 


214       WORLD'S  INSURANCE  CONGRESS 

periodic  health  examinations  to  the  end  that  health  and  life  may- 
be conserved,  and  that  the  habit  of  having  health  examinations 
may  be  encouraged  and  eventually  become  a  common  practice 
among  our  people. 

5.  To  include  in  its  field  personal,  household,  industrial  and 
community  hygiene ;  to  make  health  or  sanitary  surveys  of  homes, 
industrial  plants  and  communities. 

6.  To  give  all  consistent  support  and  encouragement  to  the 
public   health  service,   local,    State   and  National. 

7.  To  urge  prudent  and  effective  health  educational  methods 
in  schools  and  other  organizations  and  to  stimulate  individual 
and  community  interest  in  public  health  activities. 

8.  To  engage  trained  physicians  throughout  the  country,  and  to 
establish  laboratories  for  the  purpose  of  carrying  on  physical  ex- 
aminations and  research  work. 

In  order  to  carry  out  this  program,  it  was  of  course  necessary 
to  devise  a  permanent  plan  to  reach  the  individual;  one  that 
would  develop  and  grow  until  large  numbers  of  people  were 
benefited,  and  one  which  would  bring  in  the  necessary  funds  to 
make  the  Institute  self-supporting. 

A  health  educational  service  was  organized,  including  a  periodic 
health  examination  which  could  be  offered  at  moderate  cost  to  the 
life  insurance  companies  for  their  policyholders,  to  employers  for 
their  employees,  to  schools,  societies,  lodges,  etc.,  and  to  indivi- 
duals who  might  subscribe  for  the  service. 

The  Institute  operates  only  in  the  field  of  disease  prevention. 
Its  scientific  utterances  with  regard  to  individual  hygiene,  that 
is,  the  habits  of  life  that  are  conducive  to  longevity  and  to  the 
protection  of  the  vital  organs,  are  furnished  its  subscribers  in 
monthly  Health  Letters  with  the  authority  of  the  Hygiene  Refer- 
ence Board,  to  whom  they  are  referred.  In  addition  to  this,  the 
public  is  reached  through  literature  and  by  other  methods. 

While  the  Institute  is  not  yet  two  years  old,  the  popularity  of 
the  general  idea  has  rapidly  grown.  The  examination  of  thou- 
sands of  people,  including  certain  groups  of  policyholders,  em- 
ployees and  others,  already  made  by  the  Institute,  demonstrates 
most  emphatically  the  urgent  need  for  the  adoption  of  this  health 
and  life  saving  practice  by  our  people.  At  least  90  per  cent  of 
those  found  impaired  were  not  aware  of  their  condition. 

Let  us  consider  a  moment  the  American  problem  of  life-waste. 
The  advance  of  civilization,  in  the  battle  with  ignorance  and  the 
resistant  forces  of  nature,  has  been  aptly  compared  to  an  ever- 
victorious  army  progressing  slowly  at  times  but  always  irresis- 
tibly onward. 

The  successful  progress  of  this  and  of  every  great  army  re- 
quires efficiency  in  every  department.  Ever>^  detail  of  its  organi- 
zation must  be  carefully  carried  out.  Every  phase  of  the  work 
must  be  skillfully  handled,  for  failure  in  any  one  of  them  may 
retard  the  advance  of  the  entire  force. 


WORLD'S  INSURANCE  CONGRESS  215 

Many  an  army  has  been  defeated  because  those  who  were  as- 
signed to  provide  and  transport  munitions  and  supplies  or  to  guard 
the  health  of  the  units  failed  in  their  duty. 

In  America  the  march  of  progress  in  recent  years  has  been 
phenomenal,  as  is  so  strikingly  shown  by  this  exposition.  Edvica- 
tion,  the  prime  factor  in  our  success,  has  been  liberally  supplied. 
The  development  of  the  human  mind  has  in  many  ways  been 
marvelous.  The  genius  of  our  people  have  provided  for  every 
need  for  a  continued  advance  with  one  exception,  and  thai  we 
hope  to  see  provided  during  the  coming  generation.  We  are  lax 
in  the  duty  of  maintaining  the  physical  fitness  of  the  race.  In 
this  we  are  lagging  behind  the  other  important  factors  that  have 
made  the  extraordinary  march  of  American  progress  possible. 

It  is  clearly  our  duty  to  our  country  and  to  posterity  not 
merely  to  prevent  a  decline  in  national  vitality,  but  to  improve 
it  to  meet  the  increasing  stress  and  strain  of  modern  life  both  in 
peace  and  war.  The  mortality  records  furnish  the  evidence  in 
the  one  case  and  the  great  war  in  Europe  in  the  other. 

We  all  agree  that  life  is  our  most  precious  possession.  Love, 
virtue,  honor,  liberty  and  other  blessings  may  be  dearer  to  us 
than  life,  yet  we  must  be  alive  to  enjoy  them.  The  right  to  live 
is  the  first  and  most  important  item  in  humanity's  bill  of  rights. 
The  primary  and  most  earnest  desire  of  humanity  is  to  be  well 
and  strong  as  long  as  possible.  Our  people  are  deeply  concerned 
collectively  in  this  question,  for  nothing  could  possibly  be  of 
more  value  to  a  nation  than  the  lives  of  those  who  compose  it. 

All  this  being  true,  and  the  first  law  of  nature  being  self-de- 
fense, what  are  we  doing  to  guard  this  precious  asset  from  need- 
less injury  and  destruction  by  disease? 

We  teach  our  people  how  to  keep  the  community  in  a  hygienic 
condition,  but  we  do  not  teach  them  how  to  keep  the  body  and  its 
organs  in  a  healthy  condition.  We  teach  people  how  to  avoid 
giving  disease  to  others,  but  now  how  to  avoid  giving  disease  to 
themselves.  The  net  result  is  that  communicable  disease  is  de- 
creasing and  non-communicable  diseases  of  the  organs  are  in- 
creasing. 

At  a  low  estimate  we  have  900,000  premature  deaths  in  the 
United  States  annually,  due  to  our  folly  in  waiting  until  stricken 
with  disease  before  calling  upon  science  or  experience  to  protect 

us. 

This  is  the  deadly  practice  which  we  must  learn  to  abandon,  with 
the  aid  of  education  in  individual  hygiene. 

We  are  gradually  getting  sufficient  intelligence  to  know  that  if 
it  is  wise  to  call  on  the  doctor  to  relieve  or  cure  disease,  it  is 
still  wiser  to  call  on  him  occasionally  to  prevent  it. 

Think  of  the  absurdity  of  our  using  medical  science  only  to  cure 
disease.  If  a  mortal  enemy  approached  you  to  take  your  life 
would  you  wait  until  he  struck  you  down  before  attempting  to 
protect  yourself? 


216  AVORLD'S  INSURANCE  CONGRESS 

Why  then  should  you  permit  deadly  disease  to  approach  and 
strike  you  down  before  attempting  to  protect  yourself? 

Which  is  the  most  to  be  dreaded,  illiteracy  of  ill  health? 

If  we  can  afford  to  teach  our  children  and  adults  how  to  avoid 
ignorance,  why  not  how  to  avoid  disease? 

Of  what  value  is  an  education  if  we  are  too  sick  or  too  dead  to 
use  it? 

If  it  is  worth  while  to  insure  the  life  of  a  bread-winner  to 
protect  his  famih',  is  it  not  important  to  save  his  life  for  the  very 
same  purpose? 

Who  would  condemn  a  life  insurance  company  for  using  its 
influence  to  prolong  the  lives  of  its  policyholders?  Is  there  any 
surer  way  to  reduce  the  cost  of  insurance  than  to  reduce  the  aver- 
age loss? 

It  is  estimated  that  there  are  constantly  sick  in  the  United 
States  about  three  million  people,  so  sick  that  they  cannot  work. 
The  vast  majority  of  this  sickness  would  be  either  prevented  or 
postponed  if  detected  in  time.  These  same  people  would  not  fail 
to  have  their  automobiles  or  other  machinery  inspected  frequently 
to  catch  any  trouble  that  might  be  developing  before  it  became 
serious.  And  yet  they  neglect  to  do  this  much  for  the  complex  and 
delicate  human  machinery  in  their  own  bodies. 

When  we  stop  to  consider  the  enormous  waste  of  human  energy, 
of  money  and  of  life  itself  as  a  result  of  this  neglect  of  the  human 
machine,  is  it  surprising  that  the  insurance  companies  are  becom- 
ing interested  in  this  subject  and  that  such  organizations  as  the 
Life  Extension  Institute  are  established  by  public  spirited  men 
to  combat  this  deadly  folly? 

This  practice  has  come  dowai  to  us  from  prehistoric  times.  The 
barbarians  of  to-day  do  the  same  thing.  I  have  seen  them  in  Asia 
calling  upon  the  spirits  to  keep  away  disease,  but  they  never  get 
deeply  concerned  and  send  for  the  medicine-man  until  they  are 
in  serious  trouble.  With  all  their  intelligence  civilized  people  gen- 
erally follow  the  same  absurd  plan.    Isn't  it  time  to  stop  it? 

Another  urgent  reason  for  giving  heed  to  the  laws  of  health  in 
our  country  is  the  steady  increase  in  the  death  rate  from  organic 
disease  which  is  reaching  the  proportions  of  a  national  menace. 
These  are  the  diseases  resulting  from  the  wearing  out  and  break- 
ing down  of  the  important  organs. 

The  investigations  of  the  Institute  into  the  physical  condition 
of  a  large  number  of  young  people  indicate  very  clearly  that  many 
of  the  diseases  of  middle  life  and  old  age  have  their  begin- 
nings in  the  younger  age  periods  where  modern  science  can  detect 
them  long  before  the  individual  is  aware  of  their  presence  and 
check  or  cure  them  if  given  a  chance. 

Whether  American  life  strain  is  increasing  or  our  power  to 
resist  the  stress  of  modern  life  is  declining,  the  fact  remains  that 
the  extraordinary  change  in  living  conditions  of  the  American  peo- 
ple which  has  occurred  in  recent  decades  calls  for  a  readjustment 


WORLD'S  INSURANCE  CONGRESS  217 

of  our  habits  of  life  to  conform  to  these  changes.  Life  insurance 
companies  are  especially  interested  in  this  phase  of  life  waste  be- 
cause the  most  of  their  policyholders  are  in  the  age  periods  where 
this  mortality  is  highest.  About  40  per  cent  of  the  rejections  for 
life  insurance  are  due  to  the  presence  or  approach  of  organic 
disease. 

The  reason  that  we  know  that  this  life  waste  can  be  re- 
duced by  educational  methods  is  because  of  the  extraordinary  suc- 
cess we  have  had  in  reducing  the  morbidity  and  the  mortality 
from  germ  diseases.  The  people  have  learned  how  to  apply  the 
new  preventive  measures  against  these  diseases  and  they  will  learn 
how  to  guard  against  the  other  diseases  if  we  will  take  the  trouble 
to  teach  them. 

Individual  hygiene  is  a  term  that  is  misunderstood  by  many 
people.  Many  seem  to  feel  that  it  relates  to  some  new-fangled 
notion  or  system  of  exercise  or  medicine.  It  is  simply  the  appli- 
cation of  knowledge,  which  we  already  possess  and  which  we  are 
not  using,  to  guide  us  away  from  disease  and  to  increase  our  ca- 
pacity to  do  good  work. 

Individual  hygiene  relates  to  the  care  of  the  body  and  its 
organs.  It  teaches  us  how  to  avoid  unhealthful  habits  of  life  and 
informs  us  of  those  that  are  conducive  to  good  health  and  longev- 
ity, and  among  these  is  the  practice  of  periodic  health  examina- 
tions. 

An  excellent  definition  of  personal  or  individual  hygiene  is 
found  in  the  new  book  "How  to  Live." 

"Thoroughly  carried  out,  individual  hygiene  implies  high  ideals 
of  health,  strength,  endurance,  symmetry,  and  beauty;  it  enor- 
mously increases  our  capacity  to  work,  to  be  happy,  and  to  be  use- 
ful; it  develops,  not  only  the  body,  but  the  mind  and  the  heart; 
it  ennobles  the  man  as  a  whole. 

"One  of  the  most  satisfying  tasks  for  any  man  or  woman  to-day 
is  to  take  part  in  this  movement  toward  truer  ideals  of  perfect 
manhood  and  womanhood.  Our  American  ideals,  though  improv- 
ing, are  far  inferior  to  those,  for  instance,  of  Sweden;  and  these, 
in  turn,  are  not  yet  worthy  to  be  compared  with  those  of  ancient 
Greece,  still  preserved  for  our  admiration  in  imperishable  marble. 
With  our  superior  scientific  knowledge,  our  health  ideals  ought, 
as  a  matter  of  fact,  to  excel  those  of  any  age.  They  should  not 
stop  with  the  mere  negation  of  disease,  degeneracy,  delinquency 
and  dependency.  They  should  include  the  love  of  a  perfect  mus- 
cular development,  of  integrity  and  moral  fiber. 

"There  should  be  a  keen  sense  of  enjoyment  of  all  life's  activ- 
ities. As  Wm.  James  once  said,  '  Simply  to  live,  breathe  and  move 
should  be  a  delight.'  The  thoroughly  healthy  person  is  full  of 
optimism:  'he  rejoiceth  as  a  strong  man  to  run  a  race.'  We 
seldom  see  such  overflowing  vitality  except  among  children.  When 
middle  life  is  reached,  or  before,  our  vital  surplus  has  usually 
been  squandered.  Yet  it  is  in  this  vital  surplus  that  the  secret  of 
personal  magnetism  lies.     Vital  surplus  should  not  only  be  safe- 


218  ^\'ORLD'S  INSURANCE  CONGRESS 

guarded,  but  accumulated.     It  is  the  balauce  in  the  savings  bank 
of  life." 

This  is  the  great  field  of  human  service  which  the  Life  Extension 
Institute  has  entered  through  the  primary  suggestion  of  life  in- 
surance, and  which  has  been  put  into  actual  practice  through  the 
initiative  of  an  intelligent  and  progi'essive  policyholder. 

The  Institute  endeavors  to  give  effective,  concrete  and  practical 
expression  to  the  natural  desire  of  humanity  to  live  better  and 
longer  lives.  It  hopes  to  aid  in  ciystalising  into  action  the  steadily 
growing  sentiment  in  favor  of  the  conservation  of  health  and  life. 

To  the  individual  it  appeals  in  the  name  of  common  sense  to 
learn  and  observe  the  laAvs  of  healthful  living.  And  to  the  insur- 
ance companies  and  to  employers  of  men  and  women  it  appeals  in 
the  name  of  enlightened  selfishness,  for  to  raise  the  standard  of 
health  among  policyholders  and  employees  means  not  only  a  re- 
duction in  the  sick  list  and  the  death  rate,  but  an  increase  in  the 
productive  capacity  of  the  individual.  It  means  that  they  will 
help  to  strengthen,  upbuild  and  maintain  the  vitality  of  our  race 
and  at  the  same  time  secure  economic  returns  in  increased  effi- 
ciency and  a  reduced  sick  and  mortality  rate. 

As  the  Institute  develops  and  accumulates  increased  financial 
support  its  field  of  service  will  broaden  its  efforts  to  spread  the 
gospel  of  right  living  and  to  stimulate  the  interest  of  the  indivi- 
dual and  the  community  in  the  science  and  practice  of  disease  pre- 
vention will  reach  every  city,  village  and  hamlet  in  the  land. 
Presumably  the  need  for  such  an  institution  will  continue  indefi- 
nitely, and  it  is  the  hope  of  those  who  have  established  the  Institute 
that  it  may  endure  until  how  to  live  the  hygienic  life  will  be- 
come a  matter  of  common  knowledge  among  all  the  people  of  our 
land. 

In  the  gradual  development  of  this  great  movement  for  in- 
dividual and  community  hygiene  the  institution  of  insurance  has 
directly  and  indirectly  played  an  inconspicuous  but  important 
part.  Fire,  accident,  liability  and  life  insurance  have  all  had  a 
share  in  this  great  campaign  to  increase  respect  for  the  value  of 
human  life.  And  they  will  have  a  still  greater  opportunity  to 
serve  humanity  in  this  field  in  the  future  if  they  will  but  take 
an  active  interest  in  this  work. 

This  field  of  health  conservation  offers  a  new  and  attractive 
feature  for  the  institution  of  insurance.  It  enables  it  to  keep 
abreast  of  the  times  by  enlarging  its  service  to  humanity,  and 
ultimately  to  bring  to  the  people  a  reduction  in  the  cost  of  insur- 
ance. In  the  interest  of  humanity,  it  is  to  be  hoped  that  the  vision 
of  insurance  managers  will  continue  to  expand  in  this  direction. 

In  conclusion  let  me  suggest  a  health  pledge  to  which  everj-- 
body  can  cheerfully  subscribe : 

"Prompted  by  considerations  of  patriotism  and  humanity,  I  will, 
so  far  as  my  opportunities  permit,  make  an  earnest  effort — 


WORLD'S  INSURANCE  CONGRESS  219 

"1.  To  inform  myself  upon  the  subject  of  personal,  household 
and  community  hygiene,  and  to  myself  obey  the  laws  of  health. 

"2.  To  encourage  the  practice  of  individuals  having  periodic 
health  examinations  to  upbuild  physical  efficiency  and  to  detect 
disease  in  time  to  check  or  cure  it. 

"3.  To  give  support  and  encouragement,  and  to  urge  my  friends 
to  do  the  same,  to  the  public  health  service  and  officials  who  are 
laboring  to  protect  the  most  precious  asset  of  the  nation. 

"4.  To  encourage  schools,  churches,  social  and  civic  bodies 
and  employers  to  help  as  a  patriotic  duty  in  stimulating  interest 
in  and  spreading  knowledge  of  health  and  life  conservation. 

"5.  To  personally  cooperate  with  organizations  designed  to  re- 
duce life  waste  and  to  guard  and  strengthen  the  vitality  and  vigor 
of  our  race." 


UNITED  STATES  BUREAU  OF  MINES 

By  Dr.  F.  G.  Cottrell 
Chief  Chemist 

All  insurance  enterprises  whether  of  private  or  public  nature 
are  essentially  cooperative,  one  might  almost  say  socialistic,  and  co- 
operation has  been  peculiarly  the  key-note  to  the  activity  of  the 
Bureau  of  Mines  from  its  very  inception. 

The  Bureau  traces  its  origin,  as  doubtless  many  of  you  know, 
to  the  Government  Mining  Exhibit  at  the  St.  Louis  International 
Exposition  in  1904.  The  meager  Congressional  appropriation 
available  for  this  served  simply  as  a  nucleus  and  was,  through  the 
personal  efforts  of  the  late  Dr.  J.  A.  Holmes,  Chairman  of  the 
committee  in  charge,  amplified  through  the  support  and  coopera- 
tion of  the  coal  operators  and  operatives,  the  manufacturers  of 
boilers,  gas  producers,  engines  and  the  like,  the  railroads  and 
other  large  coal  users,  until  it  stood  out  as  distinctly  marked  by 
two  main  features. 

First,  the  cooperative  fuels  testing  plant  aiming  at  a  scientific 
study  of  the  most  efficient  use  of  our  various  coals  and  other  fuels, 
and 

Second,  an  educational  campaign  in  "Safety  First,"  particu- 
larly as  applied  to  coal  mining,  the  hazards  of  which  happened  to 
have  just  been  brought  home  to  the  public  by  a  series  of  par- 
ticularly disasterous  mine  explosions  during  the  preceding  year. 

In  fact,  the  now  familiar  expression  "Safety  First,"  though 
probably  not  employed  there  for  the  first  time,  seems  to  trace  much 
of  its  present  widespread  use  as  a  catchword  throughout  all  our 
national  industries  to  the  campaign  initiated  at  that  time. 

Many,  if  not  most,  of  the  practical  men  even  among  those  who 
directly  aided  Dr.  Holmes  in  this  undertaking  seem  to  have  been 
rather  skeptical  as  to  the  probable  extent,  growth  and  permanency 


220       WORLD'S  INSURANCE  CONGRESS 

which  could  be  reasonably  hoped  for  from  this  work.  Dr.  Holmes' 
remarkable  enthusiasm  and  peculiar  ability  in  such  matters  car- 
ried first  them  and  then  the  work  itself  through  the  early  uncer- 
tain stages  until  his  judgment  was  finally  vindicated  by  a  general 
awakening  of  public  interest  and  public  conscience  which  finally 
bore  fruit  in  a  response  from  our  government  in  1907,  establishing 
and  providing  for  the  maintenance  of  a  Technological  Branch  of 
the  Geological  Survey  whose  initial  functions  were  the  continua- 
tion and  extension  of  the  work  thus  started  at  St.  Louis.  In  July, 
1910,  the  work  had  reached  such  recognized  importance  that  Con- 
gress created  the  Bureau  of  Mines  as  an  independent  administra- 
tive element  within  the  Department  of  the  Interior,  coordinate 
with  the  Geological  Survey,  the  Patent  Office,  the  Reclamation 
Service  and  other  bureaus  of  that  department. 

It  should  be  clearly  understood  at  the  outset  that  the  functions 
of  the  Bureau  of  Mines  as  at  present  constituted  are  almost  wholly 
investigative  and  educational,  it  having  outside  of  the  small  area 
still  under  direct  Federal  control,  such  as  Alaska  and  the  Indian 
lands,  no  authority  to  enforce  regulations  or  even  make  investiga- 
tions except  by  permission  of  the  property  owners  or  of  the  indivi- 
dual state  authorities  to  whom  the  enforcement  of  both  safety  and 
conservation  measures  is  for  the  most  part  entrusted. 

This  very  feature  has,  however,  served  to  increase  the  popularity 
and  also  probably  the  real  usefulness  of  the  Bureau  as  it  has  still 
further  emphasized  the  intrinsically  non-partisan  and  cooperative 
nature  of  its  activities.  The  Bureau  has  constantly  striven  to 
bring  about  closer  cooperation  between  the  various  elements  of 
the  mining  industry,  particularly  for  those  larger  questions  of 
humanitarianism  and  public  policy  which,  though  appreciated  in 
the  abstract  by  most  people,  are  apt  to  be  lost  sight  of  individually 
in  the  press  of  detailed  responsibilities  unless  it  is  made  the  special 
business  of  some  one  to  show^  how,  in  a  practical  way,  such  matters 
can  be  made  an  unobstrusive  and  routine  incident  of  the  day's 
work.  However,  when  this  has  once  been  done  every  one  wonders 
how  they  could  have  ever  been  so  long  neglected. 

The  part  of  the  Bureau 's  work  which  has  undoubtedly  inade  the 
greatest  impression  on  the  general  public  is  the  actual  rescue  of 
imprisoned  miners  at  times  of  disaster,  but,  although  there  have 
been  a  large  number  of  miners  thus  rescued  by  the  Bureau  of 
Mines'  men,  this  part  of  its  work  is  considered  by  the  Bureau 
itself  chiefly  as  a  mere  illustrative  incident  and  means  to  the 
larger  end  of  securing  training  and  equipment  within  the  in- 
tegral parts  of  the  raining  industry  itself,  not  only  for  emer- 
gency in  case  of  accident,  but,  what  is  vastly  more  far-reaching, 
a  greater  and  more  intelligent  regard  for  safe  and  healthful  work- 
ing conditions  in  daily  operation.  As  a  matter  of  fact,  the  loss 
of  life  in  coal  mine  explosions  is  almost  insignificant  as  compared 
with  that  due  to  other  causes  of  equally  preventable  accidents, 
such  as  falls  of  roof,  haulage  accidents,  electric  shocks,  etc.    Statis- 


WORLD'S  INSURANCE  CONGRESS  221 

tics  even  show  that  the  accident  and  death  rates  are  actually  higher 
in  metal  mining  than  in  coal  mining.  The  great  coal  mine  disast- 
ers only  loom  relatively  large  in  the  popular  mind  because  of  their 
spectacular  setting,  still  on  account  of  this  very  setting  they  have 
afforded  a  useful  phychological  handle  by  which  to  take  hold  on 
public  interest  and  enlist  its  help  in  the  more  comprehensive  prob- 
lem of  better  working  conditions  in  general.  This  the  Bureau  has 
tried  conscientiously  to  do,  while  avoiding  as  far  as  possible  the 
public's  two  great  infective  maladies — hysteria  on  the  one  side 
and  apathetic  conservation  on  the  other. 

The  investigations  of  the  Bureau  concerning  the  causes  of  mine 
accidents  have  a  direct  bearing  upon  the  casualties  produced,  the 
loss  of  property  from  fire,  and  the  prolongation  of  the  life  of  the 
mine  worker  through  improvements  in  his  sanitary  and  living  con- 
ditions. The  Bureau  is  continually  seeking  and  determining  means 
whereby,  without  material  increase  in  the  cost  of  mine  operation, 
and  even  in  some  cases  with  a  resulting  decrease  therein,  the  num- 
ber of  casualties  per  thousand  employees  may  be  reduced  through 
better  mining  methods,  the  causes  of  fire  removed,  or  the  control 
of  the  fire  hastened,  thereby  effecting  both  a  safeguarding  of 
human  life  and  a  saving  of  property.  Efforts  are  also  being 
directed  toward  a  bettering  of  the  living  and  working  conditions 
of  the  employee  as  well  as  the  sanitary  conditions  in  his  home, 
thus  increasing  his  efficiency  as  a  worker. 

One  of  the  immediate  effects  of  these  investigations  has  re- 
cently been  reflected  in  the  insurance  world  by  the  organization 
of  an  association  of  casualty  insurance  companies  who  find  in  the 
publications  of  the  Bureau  of  Mines  the  essential  statistical  data 
regarding  fatalities  and  injuries  to  mine  workers  on  which  they 
may  safely  base  premium  rates,  and  they  have  even  gone  so  far 
as  to  fashion  their  safety  and  inspection  organization  after  that  of 
the  Bureau  of  Mines  with  the  assistance  of  one  of  its  former  en- 
gineers. 

Aside  from  the  more  directly  humanitarian  aspect  of  the  Bu- 
reau's work,  there  is  also  that  which  primarily  concerns  itself 
with  the  conservation  of  our  material  resources.  This  has  grad- 
ually developed  from  the  beginning  made  at  St.  Louis  in  the 
Fuels  Testing  Plan  which  was  later  moved  to  Pittsburgh,  Pa., 
and  has  there  been  greatly  amplified  by  additional  laboratory 
and  testing  facilities  until  its  activities  now  also  cover  investi- 
gation of  safety  and  efficiency  of  mining  explosives,  chemical 
investigations  on  petroleum  and  natural  gas,  the  smoke  problem 
in  our  cities  and  manufacturing  districts,  mine  equipment  such 
as  hoists,  haulage,  drills,  tmbering,  corrosion  of  metals  and  many 
other  technical  subjects  too  varied  to  be  here  cited  in  detail.  The 
Bureau  also  tests  and  supervises  the  purchase  of  all  fuel  used  by 
the  Government.  What  chance  for  saving  this  means  may  easily 
be  appreciated  when  it  is  realized  that  the  Government's  own 
yearly   coal   bill   is   about  $8,000,000. 


222  WORLD'S  INSURANCE  CONGRESS 

In  the  one  item  of  natural  gas  wastes  in  the  oil  fields  alone, 
wasteful  practices  of  drilling  and  operating  wells  have  in  the 
past  been  responsible  for  the  absolute  loss  of  millions  of  dollars' 
worth  of  natural  gas.  For  instance,  it  has  been  estimated  that  for 
a  long  period  the  loss  of  gas  in  the  Gushing,  Oklahoma,  field  alone 
amounted  to  the  equivalent  of  10,000  tons  of  coal  daily  and  that  at 
least  80  per  cent,  of  this  loss  could  have  been  prevented.  By  a 
campaign  of  education  and  instruction  in  well  drilling  methods, 
especially  those  providing  for  the  sealing  up  of  the  gas,  until 
needed,  in  the  overlying  sands  penetrated  by  the  bore  holes,  while 
still  drawing  the  oil  from  the  underlying  strata,  the  Bureau  has 
now  secured  the  hearty  cooperation  of  the  operators  and  state 
inspection  authorities  and  saved  to  the  country  what  still  re- 
mains of  these  irreplaceable  natural  resources  simply  by  estab- 
lishing a  precedent  for  the  use  of  thoroughly  scientific  technical 
methods.  In  this  instance,  as  in  many  others  ,the  Bureau's  initial 
entry  into  the  work  was  looked  upon  with  considerable  suspicion, 
not  to  say  hostility,  b^^  many  of  the  operators  and  state  officials 
as  possibly  threatening  local  control  and  individual  initiative,  but 
conditions  since  then  have  so  changed  that  these  same  people  are 
now  constantly  calling  on  the  Bureau's  staff  for  more  technical 
superv'ision  than  it  is  at  present  authorized  to  undertake  or  has 
means  to  carry  out. 

The  vital  importance  of  the  proper  development  and  use  of  our 
necessarily  limited  and  all  too  easily  squandered  petroleum  re- 
sources is  still  only  slowly  coming  home  to  the  general  public  as 
a  national  and  even  international  issue,  but  the  need  for  exact  and 
comprehensive  technical  knowledge  through  some  central  and  gen- 
erally available  source  is  already  being  keenly  felt  by  men  of 
affairs  in  the  business  world  as  Avell  as  by  all  our  governmental 
departments.  The  Bureau  is  doing  what  it  can  with  the  means 
at  its  disposal  and  the  cooperation  of  the  industry  to  gather  this 
information  where  it  may  be  easily  available  to  all  and  to  assist 
in  working  out  equitable  and  truly  constructive  policies  in  this 
field. 

As  already  indicated,  the  Bureau  had  its  development  almost 
exclusively  from  the  coal  and  fuels  side  of  the  mining  industry 
and  in  fact  for  the  first  few  years  of  its  existence  its  appropria- 
tions from  Congress  were  strictly  limited  to  expenditure  in  these 
specific  directions  and  much  opposition  was  met  with  toward  pro- 
viding any  government  support  whatever  for  investigations  in 
other  divisions  of  the  mineral  industry,  chiefly  on  the  basis  that 
private  interests  were  quite  able  and  should  take  care  of  all  neces- 
sary expenditures  in  these  fields  and  that  government  support 
would  either  simply  relieve  them  of  the  necessity,  on  the  one  hand, 
or  directly  interfere  with  legitimate  enterprise,  on  the  other.  An 
unwise  selection  of  either  problems  or  methods  in  entering  these 
fields  would  certainly  have  laid  the  work  open  to  valid  objections 
along  this  line,  but  Dr.  Holmes,  fully  appreciating  these  dangers, 


WORLD'S  INSURANCE  CONGRESS  223 

made  at  the  beginning  a  careful  selection  of  certain  problems 
wherein  the  public  interest  and  need  for  public  support  was 
most   clearly   apparent. 

The  problem  of  smelter  fumes  was  one  of  the  very  first  of  those 
to  be  undertaken,  as  it  formed  a  natural  connecting  link  with  the 
other  humanitaran  activities  of  the  Bureau,  on  the  one  side,  be- 
cause of  the  threatened  damage  to  health  of  both  animal  and  vege- 
table life  about  the  smelters,  while,  on  the  other,  it  had  a  very 
direct  bearing  on  the  conservation  of  our  resources  in  the  form 
of  the  valuable  mineral  constituents  going  to  waste  in  these  fumes 
and  even  the  possibilty  of  further  use  of  some  of  these  waste 
products  in  the  fertilizer  industry  for  the  increase  of  our  na- 
tional agricultural  productivity.  By  stretching  the  literal  inter- 
pretation of  the  Bureau's  then  existing  appropriation  acts  nearly 
to  the  limit,  Dr.  Holmes  succeeded  in  1911  in  setting  aside  a  few 
thousand  dollars  to  initiate  this  work.  It  soon  met  with  an  appre- 
ciative response  in  the  form  of  moral  and  financial  support,  not 
only  from  the  metallurgical  interests  but  also  from  the  farmers 
with  whom  they  had  been  in  litigation  over  fume  damage  and  this 
and  the  technical  results  produced  finally  made  a  sufficiently 
practical  appeal  to  the  judgment  of  Congress  to  secure  for  the 
fiscal  year  1913-14  its  first  definite  appropriation  for  the  problems 
of  the  metal  mining  industry. 

To  illustrate  how  much  more  far-reaching  such  results  may 
prove  than  could  be  expected  at  the  outset,  it  is  interesting  to 
note  that,  largely  due  to  the  Bureau's  etforts  to  find  an  outlet 
for  certain  of  these  smelter  by-products,  experiments  have  been 
conducted  for  the  past  two  years  at  the  agricultural  department 
of  the  University  of  California  which  now  bid  fair  not  only  to 
open  up  new  and  profitable  markets  for  these  waste  mineral  prod- 
ucts but  also  to  greatly  simplify  and  cheapen  the  problem  of 
reclaiming  and  making  productive  thousands  of  acres  of  certain 
of  our  now  barren  and  useless  land  throughout  the  country. 

The  Bureau  is,  of  course,  as  yet  very  young,  but  growing  as 
fast  as  financial  limitations  will  permit.  In  round  numbers,  its 
total  appropriation  this  year  amounts  to  onlj^  $750,000  as  com- 
pared with  $20,000,000  going  to  the  Department  of  Agriculture. 
It  would  have  been  entirely  imposible  for  it  to  have  accomplished 
what  it  alread.y  has  if  it  had  not  been  for  the  consistent  policy  of 
using  its  own  resources  primarih--  to  stimulate  and  guide  larger 
undertakings  and  expenditures  on  the  part  of  private  enterprises. 

A  pertinent  illustration  of  this  is  the  Bureau's  work  upon  rare 
metals  in  Colorado,  where  for  the  past  year  it  has  been  directing 
the  operations  of  mining,  concentrating  and  extracting  radium, 
vanadium  and  uranium  from  ore  obtained  in  the  Paradox  Valley, 
The  work  is  being  done  in  cooperation  with  the  National  Radium 
Institute,  an  organization  formed  through  the  public  spirited  inter- 
est and  financial  support  of  two  private  citizens,  to  secure  radium 
for  use  in  the  treatment  of  cancer  at  two  of  the  hospitals  in  Bal- 


224       WORLD'S  INSURANCE  CONGRESS 

timore  and  New  York,  in  a  line  of  medical  treatment  which  is  so 
new  as  to  still  involve  a  great  deal  of  investgative  and  educational 
work. 

The  world's  supply  of  radium  bearing  minerals  is  apparently- 
very  meager  and  chiefly  localized  in  a  few  limited  areas,  our  own 
carnotite  deposits  of  Colorado  being  among  the  most  important. 
Very  remarkable  curative  powers  in  the  treatment  of  cancer  have 
been  claimed  for  the  radiations  from  radium,  but  the  most  im- 
portant of  these  are  only  obtainable,  it  is  claimed,  when  the  radium 
can  be  used  in  sufficiently  large  quantities  at  one  time,  a  condition 
heretofore  almost  unattainable  in  this  country,  for  up  to  the  time 
when  the  Bureau  commenced  its  study  of  the  subject,  practically 
all  the  radium  ore  mined  in  the  United  States  had  been  shipped  to 
Europe  and  there  worked  up  into  the  finished  product,  which  was 
not  only  held  at  very  high  prices  but  on  account  of  the  active  de- 
mand in  European  hospitals  and  laboratories  was  very  difficult 
to  obtain  in  America  in  any  considerable  quantities,  even  at  any 
price.  It  was  largely  to  overcome  these  conditions  that  the  co- 
operative arrangement  was  undertaken. 

The  National  Radium  Institute  placed  some  $200,000  in  the 
Bureau's  hands  with  which  to  secure  control  of  desired  ore  de- 
posits, develop  the  processes  for  treatment,  construct  the  neces- 
sary works  and  laboratories  and  carry  out  the  actual  mining  and 
manufacturing  operations. 

A  large  part  of  the  work  originally  planned  has  now  been 
accomplished,  and,  as  a  result,  it  is  assured  that  the  full  amount 
of  radium  which  it  was  estimated  the  available  ore  could  produce 
will  be  secured  and  at  a  cost  of  less  than  one-third  of  the  pre- 
vailing market  price.  The  Bureau,  for  its  part  and  without  note- 
worthy expense  to  itself,  will  have  had  the  opportunity  of  thor- 
oughly studying  the  whole  technique  of  the  industry  on  a  work- 
ing scale,  besides  having  contributed  important  improvements  to 
the  technology  of  the  subject,  full  information  concerning  all  of 
which  will  be  made  available  to  the  public  through  its  bulletins 
as  might  not  have  been  so  fully  the  case  had  the  matter  been  hand- 
led entirely  through  private  channels. 

In  the  time  at  disposal,  it  is  naturally  out  of  the  question  to 
give  anything  in  the  nature  of  a  properly  proportioned  sum- 
mary of  the  Bureau's  work  as  a  whole,  but  it  is  hoped  that  what 
has  been  said  may  at  least  serve  to  give  some  slight  idea  of  the 
Bureau 's  policy  of  friendly  cooperation  with  all  the  other  agencies 
working  for  the  wisest  and  most  effective  use  of  our  natural  re- 
sources, both  human  and  material. 


WORLD'S  INSURANCE  CONGRESS  225 


A  PROMINENT  DEPARTMENT  STORE 

By  Arthur  Hawxhurst 
Insurnace  Manager,  Marshall  Field  &  Company 

The  Executive  Committee  of  this  World's  Insurance  Congress 
has  honored  me  with  an  invitation  to  tell  you  of  ' '  The  educational 
work  in  conservation  and  prevention  as  it  appertains  to  dangers, 
health  and  human  happiness  of  ^Marshall  Field  &  Company,  of 
Chicago — a  department  store." 

When  the  invitation  was  first  received  I  felt  it  but  just  to  de- 
cline it,  notwithstanding  the  fact  that  it  could  not  be  considered 
else  than  a  distinct  honor  to  my  House  and  myself;  still,  to  a 
modest  man  the  topic  is  a  difficult  one  to  discuss  without  an 
appearance  of  egotism. 

It  will  be  my  endeavor  to  treat  the  subject  assigned  to  me  on  a 
somewhat  wider  plane  than  mere  insurance — important  as  that 
subject  may  be — in  the  belief  that  an  inner  view  of  the  life  of  a 
great  mercantile  house  may  interest  those  before  me.  And  as  this 
Congress  is  a  part  of  a  great  World's  Fair,  I  will  treat  my  theme 
on  the  same  broad  lines  upon  which  this  exposition  itself  has  been 
conceived  and  brought  to  a  magnificent  fruition. 

In  the  first  place,  let  me  say  that  Marshall  Field  &  Company  is 
not  a  department  store  in  the  sense  generally  understood,  but  it 
is  a  mercantile  establishment  divided  into  a  wdiolesale  and  retail 
business,  which  necessitates  being  also  importers  and  jobbers  as 
well  as  manufacturers,  having  mills  of  its  own  both  in  this  coun- 
try and  abroad. 

The  wholesale  consists  practically  of  six  different  buildings, 
eight  stories  or  more  in  height.  It  is  located  towards  the  West 
Side  near  the  Chicago  River,  with  its  chief  entrance  on  Adams 
Street. 

The  rear  buildings  facing  on  Jackson  Boulevard  are  of  fire- 
proof construction,  the  main  building  on  Adams  Street,  which 
is  divided  into  three  buildings,  being  of  mill  construction;  the 
walls  are  of  brick  of  a  heavy  thickness,  and  are  faced  with 
brown  Massachusetts  granite  and  sandstone.  This  exterior,  while 
cold  and  patrician  in  appearance,  yet  bespeaks  solidity,  security 
and  durability. 

The  retail,  of  a  modified  Roman  classic  architecture,  is  the  most 
aristocratic,  complete  and  artistic  store  of  its  kind  in  the  world, 
having  been  recently  reconstructed  and  refurnished  throughout  as 
well  as  increased  in  size  by  one  large  building  on  the  north  and  in 
addition  to  this  by  a  magnificent  one  on  the  south.  The  interior  of 
this  store  is  a  revelation  of  a  wonderful  force  working  out  all  de- 
signs of  beauty  as  well  as  usefulness  in  every  one  of  its  multi- 
farious sections. 


226       WORLD'S  INSURANCE  CONGRESS 

This  world-known  store  consists  of  six  buildings  on  one  whole 
block  between  State  Street  and  Wabash  Avenue  and  an  additional 
building  twenty  stories  in  height  on  Washington  Street  facing  the 
main  buildings  and  joined  to  them  by  tunnels  under  the  street 
level.  This  last  named  building  is  unique  in  itself,  as  it  contains 
goods  for  men's  wear  only  and  is  known  consequently  as  the  Men's 
Building.  The  five  lower  floors  and  basement  are  used  for  this 
store  purpose,  while  the  sixth  floor  is  entirely  taken  up  by  a  fine 
restaurant,  also  for  the  exclusive  use  and  comfort  of  the  male  sex. 
This  room  contains  a  large  fountain  in  the  center  which  is  sur- 
mounted by  a  Tiffany  iridescent  glass  dome  of  great  beauty.  The 
balance  of  the  building  is  used  for  offices. 

The  restaurants  in  the  main  building  are  of  a  various  nature, 
and  consist  of  two  grill  rooms,  two  fountain  rooms,  one  French 
room  and  two  tea  rooms,  and  in  each  and  all  food  is  served  in  a 
most  appetizing  form  to  between  4,000  and  5,000  persons  daily. 

One  fountain  room  contains  an  exquisite  Lorado  Taft  fountain. 
In  the  other  fountain  room  another  Tiffany  dome,  which  is  on  the 
twelfth  floor  ceiling,  is  visible,  being  in  plain  sight  from  this  tea 
room  on  the  seventh  floor.  Under  this  tea  room  the  Tiffany  Com- 
pany has  also  placed  its  chief  work  of  art  in  this  store  of  beauty, 
viz.,  an  exquisite  dome  which  covers  the  entire  well  hole.  This 
can  be  seen  up  through  the  well  hole  or  skylight  from  the  first 
floor,  and  consequently  adds  elegance  to  all  the  floors  below  the 
dome.  These  domes  are  unique  and  beautiful  in  themselves  and 
attract  great  attention  from  art  lovers. 

The  different  buildings  are  divided  by  heavy  fire  walls  which  are 
pierced  in  three  separate  places  on  each  floor,  each  opening  being 
protected  by  vault  steel  doors.  These  doors  in  the  retail  weigh 
about  1,800  pounds  each,  and  in  case  of  fire  are  self-closing  by  a 
70-pound  weight,  which  shows  how  true  they  are  adjusted;  but  in 
case  of  closing  they  can  be  immediately  reopened  by  hand  by  any 
one  desiring  to  pass  from  one  section  to  another.  These  divisional 
walls  reduce  the  very  large  areas  covered  and  tend  to  conserve  life 
and  property  in  case  of  accident  or  fire.  They  also  make  one  sec- 
tion quite  independent  of  another. 

In  case  of  trouble  these  doors,  together  with  the  fire  appliances 
in  the  house,  which  are  always  kept  up  to  a  high  standard,  are 
manipulated  by  the  private  fire  departments  of  the  firm. 

These  departments  are  composed  of  picked  young  men  on  each 
floor,  who  are  called  to  active  duty  by  a  certain  whistle.  Wlien 
this  blows  each  one  goes  to  the  post  assigned  him  under  the  regu- 
lations of  his  captain.  Visitors  are  guarded  and  directed  to  the 
exits,  fire  appliances  are  produced  and  everything  is  ready  to 
protect  life  and  property.  These  forces  are  constantly  trained 
by  a  competent  superintendent  and  kept  up  to  a  fine  standard  of 
efficiency.  In  addition  to  this  Home  Guard,  an  alarm  goes  into 
the  City  Department  in  the  regular  way.  And  in  further  addi- 
tion to  this  at  certain  seasons  of  the  year,  we  have,  say,  at  Christ- 


WORLD'S  INSURANCE  CONGRESS  227 

mas  time,  for  instance,  details  of  regular  firemen  from  the  City 
Department. 

The  business  transacted  is  what  is  known  in  trade  terms  as 
the  dry  goods  business.  This  has  so  extended  itself,  however, 
that  it  now  embodies,  in  this  house  at  least,  everything  hu- 
manity needs  for  amusement,  instruction,  household  or  the  per- 
sonal use  of  men,  women  and  children,  with  the  one  exception  of 
mere  food;  but  even  this  exception  must  be  qualified  in  favor  of 
the  splendid  restaurants  already  mentioned,  likewise  the  depart- 
ment containing  candies  and  bonbons — which  are  all  of  the  highest 
grade,  the  latter  being  made  in  our  own  factory  of  all  the  purest 
ingredients  obtainable.  Of  course  a  business  so  extensve  must 
mean  a  tremendous  amount  of  merchandise  in  total,  which  must 
necessarily  be  divided  up  into  departments  for  the  convenience  of 
customers  and  visitors;  but  all  and  every  part  of  this  large  stock 
is  owned  by  this  one  corporation.  The  stock  of  a  so-called  depart- 
ment store  is  also  divided,  but  several  of  the  departments  may  be 
ow^ned  and  operated  by  outsiders,  although  but  one  name  may  be 
known  as  representing  the  combined  establishment.  With  this  class 
of  stores  the  name  department  store  originated.  With  Marshall 
Field  &  Company  you  deal  directly  with  the  absolute  owners  of 
everj'thing,  who  are  also  vitally  interested  that  each  and  every 
one  of  their  customers  shall  be  fully  satisfied  in  their  dealings  with 
the  House.  If  purchases  from  us  turn  out  to  be  not  what  the 
buyer  wants,  they  can  be  returned  and  the  money  is  cheerfully 
refunded  or  credit  given  on  open  account.  These  features  create 
a  difference  favorable  to  the  buying  public,  and  the  value  of  them 
is  widely  known  and  appreciated,  hence  it  is  worth  while  for  all 
to  become  acquainted  with  these  facts. 

Owning  and  occupying,  as  we  do,  twenty  or  more  of  the  largest 
buildings  in  the  city,  which  cover  an  area  of  5,450,000  square 
feet,  equaling  more  than  110  acres  of  floor  space — our  entire  prop- 
erties occupy  in  all  our  stores  and  offices  at  home  and  abroad  124 
acres — and  employing  a  force  of  about  15,000  people,  this  natur- 
ally represents  millions  of  dollars  in  property  as  well  as  other 
interests  which  must  be  protected  by  insurance  of  one  kind  or 
another.  This  is  done  by  carrying  about  twenty  different  kinrs  of 
indemnity,  all  of  which  is  written  in  old  line  stock  companies  with 
one  or  two  exceptions. 

All  of  this  insurance  is  handled  and  placed  by  the  private  in- 
surance department  of  and  in  the  House,  and  you  can  understand 
that  it  requires  considerable  attention  and  thought,  for  this  de- 
partment has  to  specialize  along  all  lines.  Other  concerns  divide 
up  their  insurance  between  brokers  and  agents  handling  the  dif- 
ferent kinds.  Our  House  believes  in  the  Golden  Rule,  "do  unto 
others,"  etc.,  and  has  always  felt  that  the  insurance  fraternity 
should  be  treated  with  the  same  consideration  that  is  shown  to  the 
merchants  that  they  buy  from  as  well  as  to  the  customers  that  they 
serve — that    is   to   say,   that  their  insurance   business   should   be 


228  AVORLD'S  INSURANCE  CONGRESS 

divided  witli  each  agency  directly  in  the  proportion  of  that  agent's 
facilities  to  write  the  business,  and  without  exacting  rebates  of 
any  kind.  This  naturally  conserves  the  agent's  interests  and  it 
should  bring  a  reciprocal  interest  to  the  House.  I  believe  it  does, 
for  while  our  rates  are  made  by  the  Board  of  Underwriters  upon 
the  same  schedules  as  every  one  else's  rate  is,  still  the  Department 
and  the  Board  have  always  been  able  to  agree  as  to  their  equity, 
and  in  my  experience  of  almost  daily  intercourse  with  the  fra- 
ternity for  more  than  forty  years,  I  have  yet  to  have  my  first 
unpleasantness.  Consequently,  it  gives  me  great  pleasure  to  say 
here  that  I  can  truly  and  honestly  state  that  I  have  found  the 
insurance  people  as  a  body  to  be  broad-minded,  efficient  and  re- 
liable business  men. 

Insurance  interests  are  of  the  greatest  importance  to  all  of  us. 
I  do  not  know  of  anything  that  will  confirm  this  stronger  than 
the  conflagration  report  of  the  Special  Committee  of  the  Chamber 
of  Commerce  of  your  City  of  San  Francisco,  dated  November  13, 
1906,  which  says  in  part: 

"The  lesson  that  the  insured  will  take  most  to  heart  is  that 
insurance  will  not  take  care  of  itself,  nor  will  his  broker  take  care 
of  it  for  him  without  some  watching.  The  insurance  interests  of 
a  business  house  are  immensely  important  and  should  be  looked 
after  by  a  trained  person.  The  conflagration  has  shown  the  need 
of  popular  education  in  insurance." 

Therefore,  I  say  to  vou  business  men  now  before  me,  give  this 
matter  your  first  consideration.  Buy  only  the  best  kind  of  insur- 
ance, for  these  pieces  of  paper  that  you  receive  in  exchange  for 
your  good  hard  ca.sh  to-day  may  be  your  only  assets  for  millions 
to-morrow.  Buy  your  insurance  of  the  agents  who  live  in  your 
town  representing  the  best  companies,  then  in  case  of  loss  you  will 
have  some  one  to  call  upon  to  adjust  it  with  you.  Do  not  buy 
cheap  insurance,  for  if  you  do  you  will  surely  come  to  grief  if  you 
have  a  fire.  Examine  and  understand  your  insurance  contracts 
and  what  they  cover  when  you  buy  them.  Do  not  wait  to  find 
this  out  after  a  fire.  If  you  feel  that  your  rate  is  too  high,  go 
to  your  agent  and  have  him  show  you  a  makeup  of  it,  and  let  him 
point  out  how  it  can  be  reduced  by  making  iniprovenionts.  and 
then  make  the  improvements,  thereby  not  only  lowering  the  rate 
but  eliminating  the  hazards. 

The  underwriters  should  be  publicly  thanked  for  the  work  they 
do  along  these  lines,  instead  of,  as  is  too  often  the  case,  condemned. 

Especially  .so,  as  they  are  really  no  more  interested  in  lowering 
the  burning  rate  than  others,  for  their  business  is  to  accept  risks 
as  they  find  them  and  to  charge  accordingly.  No  honest  assured 
can  afford  to  have  a  Are.  Insurance  was  not  created  to  pay  a  profit 
to  the  assured,  but  simply  to  indemnify  him  against  losses  caused 
by  misfortune — not  premeditation. 


WORLD'S  INSURANCE  CONGRESS  229 

Marshall  Field  &  Company's  work  along  the  lines  of  conserva- 
tion is  not  eonlined  to  protection  from  fires,  but  extends  itself 
throughout  the  entire  business,  and  in  reality  is,  as  Webster  an- 
swers the  word  "Conservation,"  viz.,  "the  act  of  preserving, 
guarding  and  protecting — the  keeping  of  a  thing  in  a  safe  or 
entire  state."  That  is  to  say,  Marshall  Field  &  Company  desire 
to  conserve,  they  build  to  conserve,  they  protect  to  conserve. 

The}'  have  organized  their  great  business  of  nearly  $100,000,000 
annually  along  the  broad  lines  of  duty,  service,  conservation  and 
protection  in  every  form  to  their  customers  and  the  visiting  public. 
They  make  no  other  claims  to  greatness,  although  greatness  has 
been  achieved ;  still,  they  are  willing  to  accept  the  opinion  of  the 
public  as  to  that,  but  they  do  claim  a  greatness  in  their  willingness 
and  ability  in  their  splendid  organization  to  serve  and  protect 
the  buying  public  in  various  ways — not  a  small  portion  of  the  pub- 
lic but  the  entire  public — not  only  the  rich  but  also  all  those  of 
moderate  means  and  even  less  than  that,  for  every  visitor  is  wel- 
come and  is  looked  upon  by  the  House  as  a  friend  and  a  possible 
customer ;  consequently,  all  visitors  are  shown  every  courtesy. 

How  do  they  conserve  along  these  lines?  it  may  be  asked.  This 
can  be  answered  that  they  build  buildings  that  are  free  from  all 
possible  defects  as  to  fires  happening  or  as  to  accidents  and  sick- 
ness occurring,  not  to  speak  even  of  the  possibility  of  a  loss  of 
one  single  life.  And  this  not  to  mention  also  the  manifold  things 
that  have  been  thought  of  and  are  given  free  for  the  comfort, 
health  and  happiness  of  both  customers  and  employees  alike. 

Let  me  illustrate  a  few  of  these: 

First,  the  buildings.  The  management's  best  thought  is  pri- 
marily given  to  their  construction,  and  when  its  ideas  have  been 
reduced  to  a  concrete  and  working  plan,  this  is  then  entrusted  to 
an  eminent  architect,  with  instructions  that  nothing  but  the  very 
best  in  every  particular,  with  every  up-to-date  improvement,  will 
be  acceptable  for  construction. 

When  this  is  finally  brought  to  completion,  as  it  is  now  for 
the  present,  we  have  for  the  use  of  customers,  fireproof  struc- 
tures that  protect  life  and  health  and  grant  every  comfort  that 
is  possible  in  this  every  workaday  intercourse  of  providing  for 
the  home  and  its  inmates. 

In  addition  to  these  it  can  be  also  stated  that  the  comfort  and 
protection  of  fellow-merchants  buying  at  our  wholesale  is  looked 
after,  as  well  as  that  of  employees  in  all  our  stores,  warehouses, 
factories,  garages  and  even  stables,  for  here  man's  best  old  friend, 
the  horse,  also  receives  his  share  of  care  and  thought  for  his  well- 
being. 

Opposite  yet  alongside  of  this  are  the  preventive  measures 
against  fire,  such  as  standpipes  with  hose  attached,  fire  extin- 
guishers and  sprinkler  equipments,  the  latter  being  one  of  the 
greatest  inventions  of  modern  days  to  retard  the  spreading  of  a 
fire.  Shakespeare  says,  "A  little  fire  is  quickly  trodden  out,  which 


230  WORLD'S  INSURANCE  CONGRESS 

being  suffered  rivers  cannot  quench."  This  is  what  sprinkler 
equipments  do,  viz.,  tread  it  out  quickly.  Especially  so,  when 
these  equipments  are  supplemented  by  mechanical  and  electric 
devices  as  well  as  supervised  by  human  agencies,  which  in  turn 
are  checked  by  mechanical  reporting  devices  to  outside  sources, 
such  as  fire  departments,  A.D.T.  Company,  boards  of  underwriters 
and  others,  and  Ave  utilize  all  of  these,  for  we  believe  in  "Safety 
First." 

Then,  again,  the  inspection  and  care  given  against  accidents 
happening,  such  as  to  elevators,  boilers  and  other  machinery  and 
to  the  people  on  or  operating  these. 

Fire,  I  presume,  is  the  worst  of  our  foes  to  be  guarded  against, 
for  that  affects  many  people  in  many  ways :  consequently,  much 
thought  is  given  to  protection  from  it.  This  should  be  the  case 
not  only  in  every  business  house,  but  in  every  structure,  whether 
used  for  dwellings,  mercantile  stores,  offices,  public  buildings, 
churches,  assembly  rooms  or  wherever  humanity  dwells  or  congre- 
gates. 

If  this  were  done,  the  terrible  annual  losses  from  fire,  which 
now  amount  to  $225,000,000  annually  in  this  country  alone,  would 
be  reduced.  It  is  a  good  sign,  though,  that  this  fearful  fire  loss 
was  $48,000,000  less  the  first  seven  months  of  this  year  over  that 
of  last,  and  I  attribute  this  largely  to  the  work  that  has  been  done 
by  such  bodies  as  the  National  Fire  Protection  Association,  boards 
of  underwriters.  State  Fire  Marshal  departments,  credit  men's  as- 
sociations and  others.  It  is  a  satire,  though,  on  their  efforts  that  as 
soon  as  the  fire  losses  are  reduced  the  losses  are  at  once  increased 
in  some  other  branch.  This  year  it  is  the  hail  business  that  pun- 
ishes underwriters,  for  their  losses  in  that  are  already  nearly 
$35,000,000  in  excess  of  those  of  last  year. 

It  is  too  common  an  expression  that  we  hear  after  a  loss  happens, 
"Well,  it  was  insured,"  as  if  that  reduced  the  loss  to  the  com- 
munity. 

The  people  at  large  should  be  made  to  realize  that  their  money 
pays  for  every  dollar  burned  or  otherwise  lost,  and  not  at  all  is 
it  in  reality  the  money  of  an  insurance  company.  Insurance  com- 
panies are  but  collectors  and  distributors  of  the  people's  funds 
paid  in  premiums  for  indemnifying  them  against  losses.  If  the 
rates  at  which  this  fund  is  collected  are  not  high  enough  to  bring 
a  sufficient  amount  to  pay  losses,  taxes,  expenses  and  enough  profit 
to  retain  proper  capital  in  the  business — for  otherwise  it  will  with- 
draw itself — they  are  increased  and  the  people  pay  the  increase  in 
the  end. 

If  the  rates  bring  too  much,  they  are  gradually  reduced  ac- 
cordingly, and  this  is  being  done  constantly.  In  proof  of  this 
it  can  be  stated  that  the  average  fire  insurance  rate  for  the 
United  States  for  1906,  the  year  of  the  San  Francisco  conflagi-a- 
tion,  was  1.147.  For  1907  it  was  1.17,  and  it  has  been  less  every 
year  since  then,  being,  in  1914,  1.027.    But  as  the  latter  rate  costs 


WORLD'S  INSURANCE  CONGRESS  231 

the  companies  a  loss  of  about  $15,000,000,  or  41/5  per  cent,  on 
the  year's  business,  and  as  their  total  losses  for  the  last  10  years 
have  been  8/lOths  of  1  per  cent,  on  a  business  of  $2,797,000,000, 
equaling  $22,000,000  of  loss,  two  things  might  be  considered 
proper  to  do.  First,  to  reduce  the  burnings  (which,  by  the  way, 
is  always  a  proper  thing  to  do),  or,  second,  to  increase  the  rates 
on  the  unprofitable  classes. 

Some  of  our  State  Legislatures  try  to  regulate  these  conditions 
by  enacting  laws,  which  action  is  as  futile  as  trying  to  change  the 
course  of  the  tides.  No  mere  insurance  company  can  long  pay 
out  $1.10  or  more  for  every  dollar  received,  and  as  soon  as  the 
law  attempts  to  make  them,  just  so  soon  will  the  people  be  de- 
prived of  a  beneficent  business  established  for  their  welfare. 

You  in  San  Francisco  w^ell  know  the  value  of  indemnity  that 
comes  through  insurance,  for  that  has  largely  been  the  means  of 
re-creating  this  beautiful  city  in  which  we  are  at  present. 

But  to  return  to  my  theme:  Marshall  Field  &  Company  not 
only  believe  in  protection  and  conservation  for  material  things, 
but  also  for  that  from  which  must  come  the  greatest  amount  of 
service  to  the  public,  viz.,  its  organization;  consequently  every- 
thing is  done  for  it  that  can  be  done  to  make  its  personnel  a  body 
of  healthy,  happy  and  efficient  workers.  The  organization  is  prac- 
tically a  creation  of  the  House. 

Only  bright  boys,  young  men,  girls  and  young  women  are  em- 
ployed and  then  trained  after  views  and  ideas  of  our  own  into 
capable  employees. 

In  the  first  place  we  maintain  a  medical  division  presided  over 
by  a  physician  of  standing,  who  looks  after  the  general  health 
of  all  the  employees  along  the  lines  of  hair,  eye,  ear,  nose,  mouth 
and  speech,  as  well  as  respiratory  and  infectious  diseases,  defects 
of  limbs,  etc.  He  also  looks  after  the  employees  who  have  been 
confined  to  their  homes  by  illness,  and  they  must  receive  his  ap- 
proval before  they  are  allowed  to  return  to  work. 

In  addition  to  this  we  have  endowed  beds  at  two  of  the  best 
hospitals  in  the  city  for  the  use  of  employees,  and  we  have  a 
medical  room  in  the  store  where  employees  may  receive  attention 
and  consultation  free  of  charge. 

This  gives  you  but  an  idea  of  the  attention  given  to  health. 

In  addition  to  this  we  maintain  schools  not  only  for  teach- 
ing the  employees  how  to  sell  goods,  but  also  for  their  education, 
for  all  under  eighteen  who  have  not  completed  at  least  eight  grades 
in  the  public  school  are  given  the  time  to  attend  classes  in  this 
school  in  the  building  without  reduction  of  pay ;  books  are  loaned 
to  them  and  a  university  graduate  is  furnished  by  the  House  to 
instruct  them,  and  all  without  cost  to  the  employees. 

Upon  completion  of  a  prescribed  course  of  study  embracing  busi- 
ness arithmetic,  English,  correspondence,  spelling  and  penman- 
ship, a  diploma  is  granted  in  this  school  and  the  students  are  trans- 
ferred to  classes  for  the  study  of  merchandise  from  the  raw  ma- 


232       WORLD'S  INSURANCE  CONGRESS 

terials  which  we  have  on  hand  to  demonstrate  with.  Talks  on 
scientific  selling  are  given  and  demonstration  sales  are  conducted, 
and  the  proper  attitude  towards  customers  is  made  clear  accord- 
ing to  the  ethics  of  our  House.  There  is  no  reference  to  "teacher 
or  pupil."  We  are  all  one,  learning  and  trying  out  methods  for 
the  building  up  of  the  business  to  serve  the  public  in  the  highest 
degree  possible,  and  at  the  same  time  benefit  the  employees  not 
onlj'  by  educating  them  but  by  giving  them  also  the  opportunity  to 
apply  what  they  learn. 

Every  one  is  thus  given  the  opportunity  to  develop  and  advance, 
and  as  no  favorite  relatives  or  outsiders  are  brought  in  and  placed 
over  them,  it  depends  largely  with  each  individual  whether  he 
or  she  advances  or  not.  As  an  illustration  of  those  who  have  suc- 
ceeded, I  will  cite  just  a  few  cases  out  of  the  very  many  that  I 
could  mention.  First,  our  President  started  as  a  stock  clerk  in 
one  of  the  departments  some  forty-five  years  or  more  ago — but 
more  about  him  later.  Second,  one  of  our  most  important  depart- 
ment heads  to-day,  Mr.  Thomas  Blayney,  started  as  my  personal 
messenger  boy  thirty-odd  years  ago.  In  addition  to  these,  the 
House  recently  advanced  Mr.  David  M.  Yates,  jNIr.  E.  L.  Howe  and 
Mr.  E.  L.  Corliss  to  be,  respectively,  General  Manager,  Merchan- 
dising Manager  and  Assistant  Manager  of  the  Retail  Department. 
These  men  have  all  come  up  from  the  lower  positions. 

This  system,  somewhat  military  in  aspect,  conserves,  we  believe, 
the  interests  of  the  House  and  of  the  employees,  and  it  bespeaks 
a  happy,  healthy  and  serviceable  organization.  For  it  stimulates 
and  encourages  its  members  to  strive  for  the  nobler  things  of  life, 
thereby  creating  a  better  citizenship  everywhere. 

For  the  entertainment,  relaxation  and  benefit  of  the  employees 
at  the  retail,  there  are  gj^mnasiums,  libraries,  music  rooms,  pri- 
vate restaurants,  rest  rooms,  etc. — libraries  that  circulate  6,000 
books  a  month,  restaurants  that  serve  the  very  best  food  to  over 
3,000  employees  daily  for  from  16  to  17  cents  per  meal,  music 
rooms  and  musical  societies  from  which  has  been  created  one  of 
the  finest  choral  societies  in  the  United  States. 

The  young  girls  are  carefully  looked  after  by  the  matrons  and 
everything  is  done  by  the  House  for  their  safety,  comfort  and 
womanly  well-being.  A  Welfare  Department  is  maintained,  and 
every  girl  or  woman  employed  by  the  retail  section  has  to  pass 
through  this  Bureau  for  personal  instruction  as  to  dress,  deport- 
ment, personal  appearance;  likewise  matters  pertaining  to  char- 
acter and  morality,  for  these  are  also  handled  by  this  Bureau,  as 
well  as  those  of  living  conditions.  That  is,  it  finds  out  if  a  girl 
is  living  alone,  with  friends  or  relatives;  if  she  is  not  pleasantly, 
comfortably  and  safely  located,  help  is  extended  to  secure  her  the 
right  place. 

The  young  women  are  also  at  liberty  to  consult  with  this  de- 
partment  upon   their   personal  matters   as  well   as   questions  of 


WORLD'S  INSURANCE  CONGRESS  233 

business,   and  75   per  cent,   of  the   work  is  confidential  in  that 
it  embraces  the  personal  problem  of  the  individual. 

It  is  a  pleasure  for  me  to  say  at  this  time  that  there  are  in  this 
great  organization  many  able  women  who  zealously  compete  with 
the  men  for  the  highest  positions.  It  can  be  mentioned  here,  even 
if  you  already  know  it,  that  the  greatest  store  in  Paris — the  Bon 
Marche — is  managed  by  a  woman.  This  also  is  the  case  with  one 
of  our  large  stores  in  Chicago,  and  I  understand  both  are  well 
managed. 

In  this  day  of  franchise  for  women,  my  belief  is  that  if  the 
women  can  demonstrate  that  they  have  better  capabilities  for 
the  higher  positions  than  men,  it  is  but  equity  that  they  should 
receive  them.  And  this  alongside  of  what  the  State  of  Illinois  has 
just  decided  to  do,  viz.,  to  pay  the  same  wages  to  women  as  to 
men. 

Woman  has  nursed  and  coddled  man  since  his  birth,  and  it 
seems  to  be  rank  injustice  that  as  soon  as  she  has  placed  him 
upon  his  feet  he  immediately  turns  and  says,  like  that  ship- 
wrecked Irishman  who  finally  got  onto  a  desert  island  and  could 
utter  but  one  sentence:     "I  am  agin  the  Government!" 

We  hear  much  about  the  social,  divorce  and  other  evils  and  how 
they  should  be  remedied,  but  I  believe  the  emancipation  and  bet- 
terment of  the  human  race  will  not  come  until  the  marriage  ser- 
vice is  changed  and  man  is  made  to  say  that  he  will  "Love,  honor 
and  obey"  as  well  as  the  woman.  Good  husbands  have  to  do  it 
now,  so  why  not  get  the  credit  and  also  make  a  law  at  the  same 
time  for  the  bad  ones  ?  It  is  certainly  a  parody  on  justice  for  man 
to  say  one  day,  "With  all  my  worldly  goods  I  thee  endow,"  and 
then  for  him  within  a  fortnight  to  take  it  all  back  and  try  to  grab 
off  hers  as  well;  not  to  speak  of  setting  himself  up  as  lord  and 
master  in  the  bargain.  No ;  correct  some  of  these  vital  things  first 
and  fewer  divorces  and  more  happy  marriages  will  be  the  result. 

But  to  return:  Marshall  Field  &  Company's  pride  is  not  alto- 
gether in  what  its  organization  can  do  for  itself  or  what  is  done 
for  it,  but  in  its  magnificent  ability  to  render  service  to  that  part 
of  the  public  desirous  of  being  served  by  this  House.  Having  such 
an  organization  to  handle  the  most  finely  selected  stock  of  goods 
in  the  world  for  humanity's  needs,  enables  us  to  offer  a  service 
that  is  beyond  the  possibilities  of  otherms,  and  we  believe  that  ser- 
vice to  customers  is  the  paramount  test  of  greatness.  After  all, 
that  which  is  accomplished  for  others,  rather  than  self,  is  really 
the  only  thing  worth  while,  for  it  produces  the  greatest  amount 
of  happiness. 

Selling  at  retail  as  we  do  to  175,000  charge  customers,  not  to 
mention  the  thousands  who  buy  for  cash,  and  not  to  speak  of  some 
46,000  merchants  to  whom  we  sell  at  wholesale,  certainly  is  some 
evidence  that  something  along  the  lines  of  efficient  merchandising 
and  service  has  been  accomplished  by  this  House. 

The  same  service  and  conservation,  and  yet  completeness,  enter 


234       WORLD'S  INSURANCE  CONGRESS 

into  the  merchandise  itself  that  we  offer,  for  while  we  handle  the 
best  of  everything  the  world  produces  in  our  very  many  different 
lines,  we  like^vise  offer  similar  goods  in  the  inexpensive  grades. 
We  pride  ourselves  on  being  able  to  fill  almost  any  order.  I  might 
mention  in  this  connection  that  a  customer  once  asked  us  to  send 
him  a  wife,  which  we  did,  and  I  am  sure  that  in  that  instance  we 
furnished  a  perfect  paragon,  for  there  was  no  return  of  goods 
nor  complaints. 

I  don't  know  of  anything  that  will  give  you  a  better  idea  of 
the  magnitude  and  worth  of  the  stock  that  this  House  carries  than 
to  repeat  a  conversation  between  two  ladies — one  who  had  visited 
your  beautiful  Fair  and  one  who  contemplated  doing  so.  The  sec- 
ond asked  if  it  was  fine  enough  to  go  so  far  to  see.  The  first  an- 
swered:  "Yes,  if  you  wish  to  see  beautiful  buildings  and  sights, 
but  if  you  only  wish  to  see  exhibits  then  stay  home,  save  your 
money  and  visit  Field's  Retail." 

The  Estate  of  IMarshall  Field  through  its  trustees— The  ]\Ier- 
chants'  Loan  &  Trust  Company,  Chauncey  Keep,  Arthur  B.  Jones 
and  Marshall  Field— the  latter  a  grandson— still  retain  an  invest- 
ment interest  in  the  corporation,  but  the  organization  is  exempli- 
fied in  the  person  of  its  President,  Mr.  John  G.  Shedd,  character- 
ized by  the  late  Marshall  Field  as  the  "greatest  merchant  of  his 
time." 

Mr.  Shedd  is  a  quiet,  unostentatious  man,  "Made  in  America" 
brand,  thoroughly  democratic,  approachable  by  the  humblest  em- 
ployee if  he  has  proper  business  with  him,  but  like  the  Captain  of 
a  battleship,  he  is  trained  to  the  highest  degree  of  efficiency  for  the 
high  position  which  he  holds  and  not  by  any  other  influence  but 
that  of  real  merit  and  fitness  for  the  office  of  President  of  this 
greatest  of  mercantile  houses. 

He  is  ably  assisted  in  the  management  by  the  two  Vice  Presi- 
dents, Mr.  Stanley  Field  and  ]\Ir.  James,  Simpson,  who  are  younger 
men  than  Mr.  Shedd,  but  whom  he  is  training  in  turn  for  a  pos- 
sible successorship. 

In  addition,  Messrs.  Frederick  Reynolds,  Charles  Martin.  Henry 
James  and  Thomas  Eddy  do  the  work  of  a  Treasurer,  Secretary, 
Cashier  and  Superintendent  respectively,  while  Mr.  James  Barnes 
manages  both  the  Credit  and  Law  Departments. 

If  there  is  any  one  thing  that  can  be  said  in  Mr.  Shedd 's  honor 
over  that  of  being  a  great  merchant,  it  is  his  personal  interest  in 
the  welfare  of  young  people.  He  has  not  only  the  reputation  in 
the  organization  of  being  largely  self-made,  but  of  having  trained 
more  young  men  for  higher  positions  than  any  one  else,  and  he 
clinches  this  reputation  by  making  frequent  and  munificent  con- 
trilnitions  to  the  Y.  M.  C.  A.  for  their  benefit  and  uplift. 

The  present  management  have  inaugurated  a  custom  of  giving 
to  those  who  have  served  the  House  fifty  years  a  gold  badge 
studded  with  diamonds  and  properly  inscribed.  This  not  at  all 
as  a  reward  for  services  rendered,  but  "Lest  we  forget"  in  this 


WORLD'S  INSURANCE  CONGRESS  235 

rapid  life  the  faithful  work  that  has  been  accomplished,  the  House 
as  a  remembrancer  of  and  as  a  tribute  presents  each  one  as  their 
half -century  passes  with  this  specially  designed  emblem. 

The  late  Mr.  Joseph  N.  Field,  brother  of  Marshall  Field,  de- 
ceased, pinned  the  first  badge  upon  the  breast  of  our  oldest  em- 
ployee— Mr.  Edward  Nevers — who  is  still  living  and  in  good 
health,  but  recently  retired  after  fifty-four  years  of  continuous 
service.  Others  have  received  a  badge  since  that  time  for  their 
half-century  periods. 

I  do  not  know  if  any  of  the  women  workers  will  be  willing 
to  acknowledge  fifty  years  of  service,  but  I  do  know  of  one  white- 
haired  lady,  hale  and  hearty  still,  who  is  considered  one  of  the 
most  expert  judges  of  laces  in  this  country,  who  must  be  nearing 
the  time  for  the  badge. 

The  late  Marshall  Field  was  once  asked  in  my  presence  by 
some  visiting  foreigners  whom  I  had  shown  over  the  store,  "How 
did  you  accomplish  all  this?"  And  he  answered,  "I  did  not  do 
it,  my  boys  did  it  for  me,"  a  characteristic  remark  of  a  man  de- 
cidedly great. 

An  essay  upon  this  great  House  would  not  be  complete  without 
a  reference  to  its  founder— Marshall  Field— a  man  who  started 
as  a  poor  boy,  but  when  dying  at  seventy  was  able  to  leave  millions 
alone  for  the  benefit,  education  and  pleasure  of  his  fellows  by  the 
creation  and  erection  of  a  magnificent  public  museum,  the  per- 
manent building  for  which  is  now  in  the  course  of  construction 
on  our  Lake  Front,  the  temporary  museum  and  its  exhibits  having 
been  for  many  years  in  one  of  our  beautiful  parks  on  the  South 
Side. 

Marshall  Field's  advice  to  young  men  was  that  "they  should 
carefully  consider  their  natural  bent— be  it  business  or  a  profes- 
sion; that  they  should  apply  energy  and  common  sense  to  their 
undertakings;  that  they  should  learn  to  do  work  thoroughly; 
should  enhance  their  own  and  employer's  interest  at  all  times; 
should  choose  good  companions  and  practice  honesty,  devotion  to 
duty,  self-control  and  economy,  avoiding  habits  of  self-indul- 
gence ;  that  they  should  begin  early  in  life  to  save,  if  only  a  little, 
making  themselves  a  success  in  small  things  first,  but  remembering 
above  all  else  that  character  is  better  than  wealth." 

Certainly  these  admonitions  are  manhood's  keynote  for  success 
and  happiness,  as  they  create  self-reliance,  high  principles  and 
the  conservation  of  wealth,  which  prepared  one  for  the  desirable 
positions  of  this  life  and  reaches  out  towards  those  of  the  next. 

In  conclusion  permit  me  to  apologize  for  the  length  of  ray  paper, 
but,  as  requested,  I  have  tried  to  enlighten  you  as  broadly  as  pos- 
sible in  the  time  allotted  me  upon  the  conservative  and  protective 
methods  of  this  little  world  in  itself— the  establishment  of  Mar- 
shall Field  &  Company  of  Chicago— as  they  pertain  to  insurance, 
economic  and  social  conditions. 


236  WORLD'S  INSURANCE  CONGRESS 


SAFETY  FIRST  FEDERATION  OP  AMERICA 

By  Harry  P.  Coffin 
Chairman,  Public  Safety  Commission,  Portland,  Oregon 

We  are  living  in  a  century  of  speed.  Every  endeavor,  human 
or  mechanical,  is  exerting  itself  in  obliterating  space  and  time. 
IMuch  has  been  written  of  late,  deploring  this  growing  evil  that 
has  struck  to  the  very  foundations  of  our  existence.  This  speed 
microbe  has  been  planted  in  old  and  young,  rich  and  poor,  the  dis- 
tinguished and  the  criminal,  and  no  place  either  on  land  or  sea, 
or  in  the  air  we  breathe,  seems  to  be  free  from  its  enticing  ten- 
tacles. 

Man's  ingenuity,  during  the  past  generation,  has  placed  with- 
in our  reach  dangerous  weapons  of  locomotion  and  mechanical 
operation,  revolutionizing  primeval  conditions  and  making  obso- 
lete the  antique  laws  and  regulations  governing  them. 

Our  civilization  grows  daily  more  complex.  Every^  man's  life 
is  more  inextricably  linked  with  the  lives  of  others.  Injury  or 
misfortune  to  one  is  increasingly  an  injury  to  all.  Out  of  a  just 
realization  of  these  conditions  is  coming  a  larger  sense  of  civic 
responsibility,  due  to  the  fact  that  accidents  and  deaths  have 
alarmingly  increased,  inflicting  untold  hardships  and  sorrows  upon 
families  involved,  and  causing  irreparable  loss  upon  the  commu- 
nity. 

It  is  the  general  opinion  that  75  per  cent,  of  the  accidents  are 
preventable.  It  is  said  that  fully  500,000  workers  are  partially 
or  totally  incapacitated  each  year,  carrying  an  economic  loss  of 
250  millions  of  dollars,  based  on  the  average  worker's  wage  earn- 
ing capacity  of  $500  per  annum. 

Our  country  has  spent  millions  conserving  our  national  resources 
in  the  care  of  our  forests  and  game,  but  what  of  the  conservation 
of  man?  The  Government  has  been  slow-  to  initiate  a  remedial 
movement  to  reduce  this  awful  waste  of  human  energy.  It  is  diffi- 
cult at  this  time  to  forecast  the  will  of  Congress.  It  is  quite  likely 
that  its  efforts  will  be  confined  to  industrial  safety  and  transpor- 
tation by  public  carriers  engaged  in  inter-state  commerce.  So  it 
has  largely  devolved  upon  public-spirited  citizens  in  the  local  com- 
munities to  stimulate  a  personal  care  and  responsibility  among  its 
own  people. 

Thus  sprang  into  existence  the  slogan :  ' '  Safety  First. ' '  Start- 
ing in  the  Pacific  North^yest,  it  has  spread  to  every  walk  of  life 
in  every  direction,  stamped  with  the  endorsement  of  all  classes, 
even  to  the  point  of  universality,  though  lacking  uniformity  of 
action  in  its  application.  "Safety  First"  has  become  a  world 
factor.  It  is  a  movement  without  parallel  in  the  historv-  of  na- 
tions, until  to-day  it  has  become  a  giant  issue.    Public  safety  com- 


AVORLD'S  INSURANCE  CONGRESS  237 

missions,  Safety  First  committees  and  societies  have  been  organ- 
ized throughout  the  land,  all  with  the  same  object  in  view — that 
of  accident  prevention,  but  lacking  essentially  in  the  constructive 
force  necessary  to  such  a  movement. 

Men  are  beginning  to  realize  its  importance,  but  appreciate  its 
lack  of  coordiuateness.  There  is,  however,  hardly  a  man,  woman 
or  child  on  the  street  to-day  who  has  not  been  impressed  with  the 
weight  of  that  slogan  "Safety  First."  It  acts  as  a  deterrent  to 
the  careless  automobile  driver,  it  whispers  advice  to  the  venture- 
some boy  or  girl,  it  rings  out  a  warning  to  the  engineer  at  the 
throttle,  it  holds  up  a  cautioning  finger  to  the  pedestrian,  with  but 
one  thought — "Safety  First."  So  year  after  year,  the  fruits  of 
this  movement  are  ripening,  public  sentiment  is  being  molded. 
Some  one  has  said:  "With  the  need  for  safety  and  caution  in 
the  fields  of  labor  and  hygiene  made  a  part  of  the  education  of 
our  children,  the  next  generation  of  citizens  should  be  able  to  turn 
the  sting  of  wastefulness  into  channels  of  dividends,  salaries  and 
wages.  A  barrier  against  the  rising  tide  of  the  wastefulness  in 
our  national  life  is  the  consciousness  that  gives  the  worker  a  feel- 
ing of  proper  protection.  Safety  relieves  the  tension,  prevents 
accidents,  maintains  health  and  is  an  economy  for  the  employer, 
for  in  addition  to  removing  cause  for  damage  suits  or  the  loss  of 
skilled  employees,  the  output  of  the  plant  is  increased.  It  is  cer- 
tain that  the  general  efficiency  of  any  business  is  at  a  higher  stan- 
dard when  the  employees  feel  that  their  lives,  their  health  and 
their  interests  are  matters  of  importance  to  the  management,  than 
when  this  feeling  is  absent. ' '  This  is  not  entirelfy  a  humanitarian 
movement.     It  is  a  business  proposition,  and  a  good  one,  too. 

Our  communities  are  endorsing  the  potency  of  this  movement. 
Railroads  have  installed  elaborate  systems,  our  public  service  cor- 
porations, transportation,  light,  heat,  power,  telephone,  have  made 
the  slogan  the  subject  of  careful  study  and  have  realized  its  effi- 
cacy in  the  diminishing  accident  reports.  Industrials  are  setting 
aside  large  sums  annually  for  the  dissemination  of  literature  in 
educating  their  employees  to  conserve  that  which  is  most  dear  and 
unreplaceable— their  lives  and  limbs,  as  well  as  their  property. 

The  preachment  of  conservation,  the  education  of  self-preserva- 
tion, is  fundamentally  the  first  law  of  the  State.  The  power  of  the 
commonwealth  to  enact  laws  pertinent  to  the  protection  of  health, 
safety  and  comfort  is  unquestioned,  but  unless  something  is  done 
to  codify  these  regulations  and  achieve  a  uniformity  of  purpose, 
this  movement  will  not  have  reached  its  highest  purpose. 

There  is  no  question  that  much  has  been  accomplished  by  the 
various  local  safety  movements  in  suppressing  the  chance  taker, 
eliminating  dangerous  conditions,  reducing  carelessness  and  neg- 
ligence and  carrying  the  gospel  of  safety  and  fire  prevention  to  old 
and  young,  but  much  more  effective  could  these  societies  become 
if  they  w^ere  affiliated  with  a  National  movement. 

Realizing  the  greater  effectiveness  of  a  concerted  movement,  Mr. 


238  WORLD'S  INSURANCE  CONGRESS 

Frederick  H.  Eliott,  of  New  York  City,  spent  several  years  in 
the  work  of  perfecting  a  National  organization,  exclusively  devoted 
to  the  problems  of  public  safety.  By  his  personality  and  earnest- 
ness he  interested  men  of  national  reputation  who  organized  the 
Safety  First  Federation  of  America,  Inc.  These  public-spirited 
men  gave  freely  of  their  time  and  money  to  promote  this  move- 
ment and  have  made  it  possible  for  the  P^ederatiou  to  become  an 
immediate  success.  The  plan  and  scope  adopted  into  its  by-laws 
are  worthy  of  mention  at  this  time. 

"The  Safety  First  Federation  of  America  was  organized  in  New 
York  City  on  February  twenty-fifth,  nineteen  fifteen,  for  the  pur- 
pose of  coordinating  the  work  of  the  many  public  safety  bodies 
in  a  strong  national  organization,  through  which  local  activities 
can  be  expedited  and  extended,  assuring  greater  efficiency  in  effect- 
ing results ;  to  promote  the  public  safetj^  movement,  which  has  as- 
sumed nation-wide  proportions,  in  better  safe-guarding  human 
life  and  property;  the  application  thereof  to  public  welfare  and 
occupations,  with  particular  relation  to  public  highways  and  places. 

"The  Federation  will  serve  as  a  clearing  house  for  ideas  and 
suggestions,  the  collection  of  information,  the  compilation  of  sta- 
tistics, distribution  of  literature,  and  to  advise  and  counsel  re- 
garding the  best  safety  measures  for  general  adoption,  and  assist- 
ing in  the  organization  of  local  safety  societies  and  committees. 

"The  Federation  will  endeavor  to  secure  the  enactment  and  en- 
forcement of  laws  designed  to  insure  such  safety ;  to  bring  about 
uniformity  of  laws  and  regulations  on  the  subject  among  the  sev- 
eral cities  and  states;  to  secure  the  construction  and  maintenance 
of  good  roads;  to  establish  and  maintain  exhibits  of  safety  devices 
and  methods,  and  to  define  a  comprehensive  educational  campaign 
for  public  instruction,  providing  a  uniform  lecture  course  for  pub- 
lic schools  on  safety  precautions,  compiling  a  Safety  First  text- 
book in  which  the  most  common  forms  of  accidents  will  be  graph- 
ically illustrated  and  showing  how  to  prevent  their  occurrence." 

When  ^Ir.  Darwin  P.  Kingsley,  President  of  the  New  York 
Life  Insurance  Company,  accepted  the  presidency  of  the  Safety 
First  Federation  of  America,  the  Federation  secured  one  of  the 
best  known  of  New  York's  citizens — one  who  has  established  a 
most  enviable  prestige  in  the  insurance  world  and  who  has  an 
international  reputation  in  financial,  commercial  and  industrial 
circles.  An  excerpt  from  his  remarks  in  accepting  the  presidency 
of  the  National  body  sounds  the  keynote  of  a  sane  and  efficient 
administration, 

"The  Safety  First  Federation  of  America  represents  primarily 
an  effort  to  achieve  uniformity  of  action  in  the  field  of  public  safety 
through  the  power  of  a  Mdder  public  opinion.  The  work  of  the 
Federation  will  be  wholly  educational ;  but  that  is  the  only  efficient 
method  we  have  in  this  country  in  the  achievement  of  reform. 
Laws  and  ordinances  are  easily  obtained  when  an  educated  public 


WORLD'S  INSURANCE  CONGRESS  239 

opinion  demands  it,  and  unless  such  opinion  is  back  of  law — how- 
ever excellent  its  form — its  usefulness  ceases. 

"Everybod3%  for  example,  needs  to  be  educated  as  to  what  they 
should  and  should  not  do  on  the  streets — especially  in  the  larger 
cities.  Street  traffic  has  been  revolutionized  in  twenty  years.  The 
old  way  of  crossing  the  street  will  no  longer  do.  It  is  dangerous. 
A  dog  no  longer  runs  against  or  under  the  automobile  as  he  did 
when  they  tirst  appeared.  He  has  changed  his  whole  attitude  to- 
ward street  traffic.  The  average  man  has  not  changed;  he  still 
goes  wandering  across  the  street  as  he  did  when  the  traffic  was 
wholly  made  up  of  horse-drawn  vehicles.  On  the  other  hand,  the 
traffic  as  against  the  pedestrian  has  grown  aggressive  and  careless. 
The  power  that  lies  in  the  gasoline  has,  as  it  were,  crept  into 
the  brains  of  the  auto  drivers. 

"Safety  First  in  street  traffic  is  only  one  of  our  objects.  We 
look  to  tiie  greatest  development  in  the  direction  of  cooperation 
with  the  existing  machinery  which  is  to  be  found  throughout  the 
country  in  the  local  Safety  First  organizations  or  public  safety 
committees  of  boards  of  trade,  chambers  of  commerce,  automobile 
clubs  and  kindred  bodies  interested  in  public  welfare,  which  neces- 
sity and  urgent  demand  or  corrective  measures  have  already  cre- 
ated. My  full  sympathy  with  the  object  of  Safety  First  has  been 
enlisted,  and,  in  accepting  the  presidency,  it  is  my  hope  and  desire 
to  further  the  work  that  means  true  economy,  conservation  of 
life  and  property." 

From  a  perusal  of  the  plan  and  scope  of  our  National  organi- 
zation, it  is  very  clearly  defined  that  all  its  energies  and  activities 
will  be  devoted  to  public  safety,  that  it  is  the  only  organization  in 
the  country  confining  its  undertakings  in  this  direction  and  will 
not,  for  the  present  at  least,  digress  to  that  of  industrial  safety, 
therefore  conflicting  in  no  way  with  the  aims  or  purposes  of  any 
other  organization  or  association  with  activities  of  a  national  in- 
clination. 

There  has  been  an  appreciable  decrease  in  accidents  due  to 
the  work  of  the  Federation  in  the  short  time  of  its  existence. 
Its  field  of  usefulness,  however,  is  broadening  each  day.  A  num- 
ber of  the  National  committees  have  been  authorized  and  are  at 
work.  The  Transportation  Committee,  of  which  Police  Commis- 
sioner John  Gillespie,  of  Detroit,  is  Chairman,  has  under  consid- 
eration recommendations  which  have  been  approved  by  the  Amer- 
ican Electric  Railway  Association,  the  most  important  of  which 
are : 

Standardization  of  traffic  regulations. 
Approved  uniform  signs  and  signals. 
Regulation  of  vehicles  and  street  cars  as  to  operation  on  public 

highways. 
Near  stop  for  street  cars. 
Regulation  of  jitneys. 

Designation  of  safety  zones  and  cross  walks  after  the  Detroit  plan. 
Educating  the  public  to  cross  the  street  at  regular  crossings  and 


240  WORLD'S  INSURANCE  CONGRESS 

urging  upon  municipalities  the  centralization  of  authority  for 
directing  pedestrian  travel  as  provided  in  the  Detroit  plan. 

Exclusive  use  of  siren  whistle  on  fire  and  police  vehicles. 

Standard  form  for  reporting  accidents  by  municipalities. 

Elimination  of  glaring  headlights  on  motor  vehicles  in  populated 
districts. 

A  nation-wide  campaign  relative  to  danger  at  grade  crossings  and 
trespassing  on  railroad  property. 

The  endorsement  of  the  plan  of  the  Safety  First  Society  of  New 
York,  of  which  Mr.  Charles  L.  Bernheimer  is  president,  for 
the  appointment  of  a  street  traffic  and  vehicle  commission  for 
the  State  of  New  York,  favorable  action  of  which  has  been 
assured  by  his  excellency,  Governor  Whitman.  The  duty  of  this 
commission  will  be  to  investigate  and  consider  the  desirability 
of  a  more  uniform  traffic  regulation  throughout  the  state, 
for  the  movement  and  direction  of  all  vehicles  upon  the  public 
streets  and  highways,  to  take  the  place  of  local  ordinances  ex- 
cept such  provisions  which  are  purely  local  to  a  community, 
such  as  parking  of  autos,  one-way  traffic,  etc.  A  similar  com- 
mission would,  no  doubt,  be  popular  in  other  parts  of  the 
nation. 

Important  is  the  reference  to  the  danger  of  trespassing  on  rail- 
road tracks.  Words  cannot  express  the  extreme  hazard  one  as- 
sumes in  walking  on  the  right  of  way,  trestle  or  bridge  of  a  rail- 
road. During  the  last  twenty-four  years,  there  have  been  108,009 
persons  killed,  117,257  persons  injured — a  total  of  225,266  walking 
on  the  railroad  tracks  and  flipping  on  cars  in  the  United  States. 
Of  these  14:9,163  were  citizens  of  the  locality  in  which  accidents 
occurred,  mostly  wage  earners;  31,049  were  children  under  18 
years  of  age,  45,054  were  tramps  and  hoboes. 

A  number  of  railroad  companies  have  endeavored  to  obtain  leg- 
islation in  various  States,  thirty-five  of  which  have  no  law  specifi- 
cally prohibiting  trespassing,  with  no  results,  owing  to  the  hos- 
tility of  the  rural  localities  who  use  the  railroad  track  as  a  short 
cut  and  highway,  but  oftentimes  a  short  cut  to  eternity.  The  sub- 
ject of  trespassing  will  be  one  of  the  important  items  considered 
at  the  coming  convention.  In  all  probabilities,  Congress  will  be 
petitioned  to  make  a  law  prohibiting  the  entering,  going  upon  or 
being  upon  the  property  of  any  railway  engaged  in  inter-state 
commerce  and  putting  it  up  to  the  United  States  :Marshals  to  en- 
force it. 

Now  let  us  turn  for  a  moment,  if  you  please,  to  that  phase 
of  safety,  the  prevention  of  loss  of  life  and  property  by  fire  and 
the  protection  of  our  citizens  against  that  most  dreaded  of  all  the 
elements.  This  important  subject  is  handled  by  the  Fire  Insur- 
ance Committee  presided  over  by  i\rr.  Elbridge  G.  Snow,  President 
of  the  Home  Insurance  Company  of  New  York,  and  the  Fire  Pre- 
vention Committee  in  charge  of  Mr.  William  Guerin,  former  Chief 
of  the  Fire  Prevention  Bureau  of  the  Fire  Department  of  the  City 
of  New  York.     Sad  to  relate,  there  are  manufacturers  and  busi- 


WORLD'S  INSURANCE  CONGRESS  241 

ness  men  who  do  not  care  about  fire  prevention,  who  are  annoyed 
to  have  it  talked  about,  who  will  not  spend  a  cent  as  a  precaution- 
ary measure,  unless  forced  to.  neither  will  they  cooperate  in  any 
movement  looking  to  an  amelioration  of  these  conditions.  Owing 
to  this  apathy,  it  is  a  hard  problem  to  initiate  thoroughly  such  a 
movement.  It  is  a  significant  fact,  however,  that  we  are  begin- 
ning to  realize  the  economical,  if  not  the  social,  value  of  one  human 
life,  which  cannot  be  measured  in  dollars  and  cents.  Property 
can  be  easily  replaced  via  the  underwriters  route,  just  as  long 
as  the  Fire  Insurance  Companies  meekly  pay  the  losses,  but  our 
business  men  little  realize  that  these  same  insurance  companies  are 
practically  our  agents  in  collecting  and  distributing  money  and 
that  this  same  commercial  body  is  affected  indirectly  in  the  mil- 
lions of  dollars  of  property  ruined  by  fire  annually.  These  com- 
mittees jointly,  are  considering  a  nation-wide  educational  cam- 
paign to  reduce  these  losses  by  fire  throughout  the  country.  Com- 
mittee members  from  all  parts  of  the  United  States  and  Canada 
met  in  New  York  August  nineteenth  last  and  voted  to  recommend 
to  the  forthcoming  annual  convention: 

1.  Enactment  of  fire  prevention  laws  in  all  States  of  the  Union. 

2.  Appointment  of  Fire  ^Marshals  in  all  States. 

3.  Enactment  of  state  building  codes. 

4.  Legislation  covering  combustibles  and  explosives. 

5.  Legislation  making  persons  liable  for  loss  or  damage  to  others 

due  to  carelessness. 

6.  Establishment  of  a  National  fire  prevention  day. 

7.  Campaign  of  education  on  fire  prevention.  Also  to  promote  a 

movement  for  a  sane  Fourth  of  July  and  to  support  the  proper 
authorities  in  their  effort  to  minimize  the  number  of  prevent- 
able accidents  due  to  the  celebration  of  our  National  holiday. 

The  Health  and  Sanitation  Committee,  led  by  Dr.  Gardner  T. 
Swarts,  of  Providence,  Secretary  of  the  Rhode  Island  State  Board 
of  Health,  will  recommend  proper  legislation,  requiring  that 
loaves  of  bread,  rolls,  biscuits,  cake,  etc.,  shall  be  sold  only  enclosed 
in  suitable  wrappers — a  practice  followed  of  late  by  manufac- 
turers of  tooth  brushes,  tooth  picks,  Domino  sugar  and  other  ar- 
ticles for  personal  use  which  necessitates  much  handling  in  shops 
and  marts.  The  Pure  Food  Agitation  will  also  be  considered  and 
many  important  recommendations  will  be  made  for  the  safeguard- 
ing of  the  health  of  the  public. 

One  of  the  most  important  undertakings  of  the  Federation  will 
be  the  publication  of  the  text -book,  "Safety  First  for  Children," 
in  which  the  most  common  forms  of  accidents  will  be  graphically 
illustrated,  showing  how  to  prevent  their  recurrence.  It  is  the 
plan  that  every  boy  and  girl  in  the  public  schools  will  have  one 
of  these  booklets.  Indications  point  to  a  large  number  of  en- 
dorsements  and    approvals    from    municipalities,    warranting  the 


242       WORLD'S  INSURANCE  CONGRESS 

statement  that  "Safety  First  for  Children"  will  have  the  greatest 
edition  of  any  book  ever  published. 

The  subject  matter  before  you  has  been  treated  only  in  a  gen- 
eral way.  Time  forbids  of  a  more  detailed  discussion  of  so  vast 
a  subject,  but  if  the  Federation  can  accomplish  the  task  of  mak- 
ing men  think  "Safety"  and  thus  minimize  an  element  of  chance 
in  the  conservation  of  human  life  and  limb,  its  labors  will  not  have 
been  in  vain. 

In  closing,  may  I  suggest  a  thought  that  those  two  words 
"Safety  First,"  should  be  held  as  sacred  as  the  sign  of  the 
Geneva  Red  Cross  on  its  errand  of  mercy.  They  should  not  be 
used  lightly  or  in  jest  or  in  an  advertising  way,  but  when  a  man, 
woman  or  child  sees  those  two  words,  "Safety  First,"  it  should 
be  an  incentive  to  "Stop — Look — Listen." 


NATIONAL  ASSOCIATION  OF  CREDIT  MEN 

By  C.  E.  Baen 
Assistant  Manager,  International  Banking  Corporation 

Mr.  Chairman  and  Gentlemen:  The  National  Association  of 
Credit  Men  has  delegated  me  to  address  you  gentlemen  this  after- 
noon. I  assure  you  it  gives  me  great  pleasure  and  I  appreciate 
the  honor  of  appearing  before  such  an  important  convention  as 
the  World's  Insurance  Congress. 

While  I  am  not  fully  in  sympathy  with  the  National  Associ- 
ation's choice  of  a  speaker  on  this  occasion,  since  I  feel  it  could 
have  made  a  wiser  and  better  selection,  nevertheless  I  share  with 
you  gentlemen  a  lively  interest  and  a  full  sympathy  with  this  very 
great  and  important  subject  which  has  been  assigned  me,  that  of 
Fire  Waste  and  Fire  Prevention. 

It  seems  exceedingly  appropriate  that  this  great  Insurance  Con- 
gress should  be  held  in  San  Francisco  this  year — not  alone  because 
we  are  holding  what  we  believe  to  be  the  greatest  Exposition  the 
world  has  ever  seen,  in  celebrating  the  building  of  the  Panama 
Canal,  but  also  because  this  City,  as  you  see  it  to-day,  is  real  evi- 
dence of  the  solvency  of  fire  insurance  companies  throughout  the 
world  and  their  ability  to  meet  and  successfully  overcome  even  so 
great  and  dreadful  a  calamity  as  the  San  Francisco  tire  of  April 
18,  1906. 

The  National  Association  of  Credit  Men  for  nearly  twenty  years 
has  conducted  a  vigorous  campaign  for  the  betterment  of  credit 
conditions  in  the  United  States.  It  is  but  natural,  then,  that  this 
great  live  organization  of  nearly  twenty  tliousand  members  in 
every  commercial  center  of  our  great  country  should  be  lending 
its  energy  and  its  influence  to  reduce  fire  waste  and  to  do  every- 
thing in  its  power  to  bring  about  a  better  solution  of  the  fire  in- 


WORLD'S  INSURANCE  CONGRESS  243 

surance  problem  as  it  exists  today  in  every  section  of  the  United 
States. 

Appreciating  that  excessive  fire  losses  must  necessarily  have  a 
damaging  effect  on  credits  in  general,  a  fire  insurance  committee 
was  appointed  and  made  its  first  report  to  the  National  Associa- 
tion of  Credit  ]\Ien  at  its  convention  held  in  Chicago,  June,  1907. 
This  report  called  attention  to  the  great  possibilities  of  the  Asso- 
ciation to  assist  in  this  great  work,  urged  that  there  be  established 
uniform  inspection  laws  and  ordinances  throughout  the  States 
of  the  Union  and  also  recommended  the  adoption  in  all  States  of 
a  uniform  standard  fire  insurance  policy. 

The  Committee's  report  of  the  following  year — 1908 — empha- 
sized that  greater  efforts  would  have  to  be  put  forth  to  better  con- 
trol and  reduce  our  enormous  fire  losses,  and  brought  before  its 
membership  in  as  forceful  a  manner  as  possible  its  seriousness 
from  an  economic  point  of  view.  The  Committee  also  began  to 
seek  means  of  preventing  this  useless  fire  waste  and  for  the  first 
time  urged  that  there  be  established  in  every  State  of  the  Union 
a  Fire  Marshal  Law.  This  law  was  designed  to  give  to  Fire  Mar- 
shals adequate  and  liberal  powers,  such  as  authority  to  enter  pri- 
vate premises,  make  careful  examination  as  to  origin  of  fires,  make 
arrests  and  such  other  acts  as  might  be  necessary'  to  completely 
carry  out  its  provisions. 

At  this  time  a  fight  was  begun  against  the  "valued  policy  law" 
which  had  been  passed  by  the  legislatures  of  several  of  the  South- 
ern States,  and  which  in  the  opinion  of  the  Committee  very  largely 
increased  the  incentive  for  incendiary  fires  and  consequently 
would  necessarily  increase  fire  insurance  rates  in  those  States 
where  these  laws  were  on  the  Statute  Books. 

A  definite  plan  for  the  education  of  its  members  was  outlined 
and  through  its  members  the  retail  dealers  of  the  country  were  to 
be  reached. 

During  the  years  1908  and  1909,  almost  every  local  association 
affiliated  with  the  National  Association  appointed  fire  insurance 
committees,  invited  speakers — experts  and  well  known  underwrit- 
ers and  fire  insurance  men — to  discuss  before  its  membership  fire 
waste  and  better  means  of  curtailing  this  great  burden  on  the  busi- 
ness men  of  the  United  States.  The  Committee,  in  1909,  in  order 
to  conduct  a  campaign  of  education  among  the  retail  dealers  of 
the  country,  caused  to  be  written  a  series  of  six  pamphlets  cover- 
ing the  entire  subject  in  a  concise,  readable  form,  designated  as 
"Burning  Subjects."  These  articles  hit  the  spot,  were  read  with 
great  interest  and  several  millions  were  issued. 

Local  fire  insurance  committees  began  to  get  in  working  order 
by  1910,  through  whose  efforts  the  well  known  fact  of  the  rela- 
tion of  fire  insurance  losses  to  fire  insurance  premium  costs  was 
discussed,  and  efforts  were  made  in  a  number  of  Committees  to 
reduce  these  costs  by  reducing  fire  hazards. 

All  of  this  work,  Gentlemen,  was  educational  and  instructive, 


244  WORLD'S  INSURANCE  CONGRESS 

and  we  believe  in  a  large  measure  effective,  since  one  of  the  most 
discouraging  aspects  of  this  subject  is  the  apparent  lack  of  in- 
terest of  the  great  masses  of  our  people  who  seem  content  to  pay 
whatever  insurance  premium  the  conditions  require  and  let  it  go 
at  that.  The  present  attitude  of  mind  of  the  public  to  this  great 
question  of  fire  waste  is  the  greatest  stumbling  block  in  the  way 
of  remedying  it.  Once  you  get  the  facts  squarely  before  the  pub- 
lic, and  get  them  to  realize  their  significance,  you  are  well  on  the 
way  to  better  fire  insurance  conditions. 

The  work  of  the  National  Association  was  generally  supple- 
mented and  supported  by  representative  fire  insurance  men.  They 
supplied  speakers  freely,  and  cooperated  in  every  way  that  was 
open  to  them. 

The  National  Board  of  Fire  Underwriters  at  the  National 
Conservation  Congress  held  in  Kansas  City,  Mo.,  September,  1911, 
spoke  of  this  work  in  these  terms: 

"The  National  Association  of  Credit  Men,  which  has  perhaps 
devoted  more  time  to  the  study  of  insurance  and  fire  waste  of 
the  country  than  any  other  commercial  body,  has  been  very  active 
in  acquainting  business  men  with  the  importance  of  the  subject, 
and  in  encouraging  the  adoption  by  municipality  and  State  of  such 
remedial  measures  as  will  tend  to  diminish  the  steadily  and  rapidly 
increasing  fire  losses. ' ' 

Fire  insurance  is  a  great  business  in  the  United  States,  but  fire 
insurance  companies  are  in  a  large  measure  only  trustees  for  their 
policyholders,  obligated  by  the  insurance  laws  of  several  States  to 
hold  as  a  trust  fund  out  of  premium  receipts  a  very  large  per- 
centage thereof  for  the  purpose  of  paying  the  very  heavy  unusual 
losses  which,  like  the  poor,  are  always  with  us. 

Out  of  what  remains  over  legal  reserves  must  come  the  cost  of 
operation,  which  includes  agents'  and  brokers'  commissions,  cost 
of  inspections,  taxes,  which  in  some  States  are  burdensome,  and 
losses;  what  is  left  of  the  fund,  if  it  has  been  a  good  year,  and 
that  means  of  the  fire  loss  is  normal,  say  two  hundred  and  twenty- 
nine  millions  of  dollars,  which  is  the  average  loss  for  the  past  four 
years  in  the  United  States  and  Canada,  goes  to  the  stockholders 
of  the  companies  as  their  reward  for  affording  the  protection. 

The  public  generally  assumes  the  business  of  fire  insurance  to  be 
a  very  hicrative  one,  and  that  fire  insurance  companies,  froin  some 
source  or  other  are  able  to  obtain  enormous  sums  year  after  year 
with  which  to  meet  their  losses.  The  facts  are  that  in  the  past  ten 
years,  owing  to  extraordinary  losses  caused  by  general  conflagra- 
tions in  Baltimore,  Toronto  and  Rochester  in  1904,  San  Francisco 
in  1906,  Chelsea,  Mass.,  in  1908,  the  stockholders  of  American  fire 
insurance  companies  were  called  upon  to  advance  over  forty  mil- 
lions of  dollars  of  new  capital  to  rehabilitate  and  refinance  their 
companies  in  order  that  our  great  commercial  interests  could  have 


WORLD'S  INSURANCE  CONGRESS  245 

proper  and  adequate  fire  insurance  capital.  Those  companies 
whose  stockholders  were  unwilling  or  unable  to  make  these  sacri- 
fices were  compelled  to  compromise  with  policyholders,  liquidate 
their  business  as  best  they  could,  and  retire  from  the  field.  Nat- 
urally, some  of  these  losses,  having  been  transferred  to  policy- 
holders, brought  forth  from  them  a  mig  howl  and  we  heard  a  great 
deal  of  welching  fire  insurance  companies  as  well  as  a  lot  of  un- 
merited and  unjust  criticism  of  fire  insurance  in  general.  It  is 
difficult,  Gentlemen,  to  see  in  this  attitude  of  the  American  people 
towards  fire  insurance,  that  spirit  of  fairness  which  they  generally 
show  on  all  other  great  questions.  It  is  still  more  difficult  to  un- 
derstand how,  year  after  year,  we  allow  two  hundred  and  fifty 
million  dollars  of  our  national  wealth  to  be  destroyed  by  fire  waste, 
particularly  when  we  are  told  by  those  having  expert  knowledge 
of  this  subject,  acquired  by  years  of  experience  as  underwriters, 
that  from  50  to  80  per  cent,  of  this  great  sum  annually  lost  is 
due  to  preventable  causes  and  might  be  saved  if  proper  care  is 
exercised,  proper  inspection  work  done  and  better  regulations  ob- 
served as  to  the  erection  of  buildings  and  keeping  premises  free 
from  accumulated  debris  and  rubbish.  This  does  not  seem  to  be 
such  a  tremendous  undertaking,  since  all  of  our  large  cities  have 
expensive  and  well-manned  fire  departments.  Doesn't  it  seem 
reasonable  that  more  of  their  energies  could  better  be  expended  on 
well-known  means  of  fire  prevention  as  well  as  answering  fire 
calls?  Doesn't  the  old  time  doctrine  of  "an  ounce  of  prevention" 
seem  to  apply  in  this  case? 

The  Fire  jMarshal  of  the  State  of  Illinois,  in  his  third  annual 
report,  stated  that  he  believed,  if  the  chiefs  of  Fire  Departments 
of  the  cities  of  the  States  would  delegate  two  or  three  of  their 
most  capable  men  as  inspectors,  and  keep  them  busily  engaged  in 
that  work,  the  fire  loss  of  Illinois  would  be  cut  down  one-half. 

San  Francisco's  fire  department  for  the  year  1912  cost  $1,562,- 
769  or  $3.62  per  capita.  That,  Gentlemen,  seems  a  very  large  sum 
to  pay  for  fire  protection,  but  notwithstanding  this  great  expendi- 
ture, San  Francisco's  fire  loss  for  that  year  was  $999,975,  or  $2.35 
per  capita.  It  would  seem  a  fair  deduction  from  these  figures, 
and  those  of  other  American  cities  as  well,  that  our  fire  depart- 
ments, the  most  efficient  as  well  as  the  most  expensive  of  any  coun- 
try in  the  world,  as  purely  fire  fighting  agencies  and  a  means  of 
preventing  excessive  fire  loss,  cannot  be  considered  a  success,  since 
our  fire  loss  continues  to  increase  in  a  greater  ratio  than  our  pop- 
ulation. 

Fire  prevention,  then,  looks  like  a  more  productive  field  and 
offers  more  encouragement  than  mere  fire  fighting.  ]\Ir.  C.  Holler, 
in  a  splendid  article  on  fire  prevention,  points  out  that  most  of 
the  countries  of  Europe  have  worked  out  the  problem  from  this 
viewpoint  and  with  very  much  better  results.  He  quotes  from  a 
Federal  Report  of  1907  that  the  cost  of  maintenance  of  Fire  De- 


246       WORLD'S  INSURANCE  CONGRESS 

partments  in  the  larger  European  cities,  having  an  aggregate  pop- 
ulation of  15,074,432,  was  $3,069,668,  or  20  cents  per  capita. 

For  the  cities  of  the  United  States  having  a  combined  popula- 
tion of  29,250,000  the  cost  of  fire  departments  in  1912  was  $47,- 
385,546  or  $1.62  per  capita,  yet  our  fire  loss  is  one-quarter  of  a 
billion  dollars  annually  while  theirs  is  one-sixth  of  this  amount, 
or  $40,000,000  annually.  The  reason  for  this  great  difference,  Mr. 
Holler  explains,  is  largely  because  they  have  paid  more  attention 
to  fire  prevention  than  we  have,  that  they  have  built  substantial 
cities,  have  brought,  by  adequate  laws  on  the  subject,  the  people 
to  a  full  knowledge  of  their  moral  and  financial  responsibility  for 
careless  fire  waste,  and  thereby  have  minimized  fire  loss,  cost  of 
insurance  and  by  that  much  reduced  the  cost  of  living. 

It  would  seem  the  fire  departments  of  our  American  cities 
would  bring  better  returns  for  the  large  sums  spent  for  their  main- 
tenance if  they  could  be  made  more  efficient  along  the  lines  of  fire 
prevention  than  they  now  are.  Surely,  these  great  efficient  fire 
fighting  organizations  of  ours  could  be  developed  into  a  Avonderful 
force  for  teaching  residents  of  our  great  cities  and  the  property 
owners,  the  necessity  for  taking  a  greater  interest  in  fire  waste  and 
fire  prevention,  bringing  home  to  them  the  fact  that  at  least  50 
per  cent,  of  their  fire  losses  might  be  saved  by  simple  and  com- 
paratively inexpensive  precautions  against  fire  and  that  thereby 
their  premium  cost  of  insurance  might  be  materially  reduced. 

Finally,  Gentlemen,  I  am  led  to  believe  from  what  information 
I  have  gathered  in  a  very  general  way  in  securing  data  for  this 
paper,  you,  w^ho  are  instructed  with  safeguarding  the  large  amount 
of  capital  which  is  now  invested  in  the  hazardous  business  of 
fire  insurance,  should  continue  to  make  every  possible  effort,  in  and 
out  of  season,  to  encourage  and  educate  the  people  to  cooperate 
with  you  along  these  lines  in  a  more  sympathetic  and  intelligent 
manner,  to  the  end  that  there  might  be  saved  to  the  nation  a  much 
larger  part  of  its  annual  fire  insurance  tax  and  your  own  insur- 
ance capital  would  be  made  more  secure  and  better  satisfied  to 
remain  in  this  great  field,  which  is  a  matter  of  very  great  import- 
ance to  the  successful  conduct  of  our  commercial  activities. 


AMERICAN  BAR  ASSOCIATION 

By  Arthur  I.  Vorys 
Chairman,  Committee  on  Insurance  Law 

In  conservation  the  American  lawyer  takes  first  rank.  Without 
Order,  Law,  Peace,  all  efforts  at  material  conservation  would  be 
dissipated.  The  function  and  the  duty  of  the  lawyer  are  to  en- 
force the  Constitution  and  the  Law.  His  business  is  to  preserve 
rights  and  punish   wrongs  by  the  orderly  and  peaceful  methods 


WORLD'S  INSURANCE  CONGRESS  247 

of  the  law.  Upon  the  American  lawyer  rests  the  special  respon- 
sibility of  preventing  disorder  and  anarchy,  and  of  conserving  dis- 
cipline, order,  peace,  as  designed  and  directed  by  the  people  in 
their  constitntons  and  laws. 

To  him  the  Constitution  and  the  Law  are  supreme.  He  knows 
no  ether  guide.     He  yields  to  no  other  power. 

At  the  Bar  he  advocates  his  cause  as  he  sees  it  under  the  Law. 
Armed  with  the  La  whe  is  fearless  before  any  court.  He  is 
unabashed,  unawed,  dauntless,  before  any  tribunal  or  potentate, 
or  any  body  of  men,  or  the  American  people  themselves,  or  any 
power  or  force  on  earth  save  the  power  and  force  of  the  Law. 

On  the  Bench  he  recognizes  no  power  above  the  Law  but  the 
Constitution,  and  no  power  on  earth  above  the  Constitution.  He 
is  the  expounder  of  both  and  applies  them  to  the  cause  as  he  de- 
termines it.  He  compels  obedience  of  law-makers  to  the  Consti- 
tution.    He  compels  obedience  of  all  to  the  Law. 

On  the  Bench  or  at  the  Bar,  the  American  lawyer  always  has 
his  face  set  toward  the  Constitution  and  the  Law.  There  and  there 
only  he  looks  for  light,  for  guidance  and  for  strength — "As  the 
sunflower  turns  to  her  god  when  he  sets,  the  same  look  which  she 
turned  when  he  rose." 

Backed  by  the  Law,  the  lawyer  knows  no  fear  in  the  presence  of 
any  foe.  Every  fiber  of  his  being,  every  instinct  of  his  soul  in- 
stantly springs  to  defense  against  any  and  all  who  would  oppose 
the  law.  This  Republic,  this  tremendous  American  experiment, 
this  century-old  wonder  of  the  world,  stands  to-day  the  trium- 
phant expositor  of  its  own  success,  because  of  the  universal  yield- 
ing to  the  Constitution  and  the  Law.  But  when  our  institutions 
have  been  threatened,  when  crises  have  impended,  then  the 
initiative,  tlie  leadership  and  the  indomitable  courage  of  the  Amer- 
ican lawyer,  obstructing  the  enemies  of  Law  and  Order,  calling  the 
people  to  their  senses,  settling  our  institutions  on  their  true  foun- 
dations, the  Constitution  and  the  Law,  have  always  averted  the 
threatened  catastrophe  and  brought  the  ship  of  state  back  to  her 
safe  mooring. 

Chief  Justice  White,  in  immortal  words,  has  said:  "How  mar- 
velously  the  existence  of  these  United  States  as  they  stand  to-day: 
a  mighty  people  with  a  National  government  adequate  to  fulfill  its 
purposes,  with  State  governments  sufficient  to  preserve  local  au- 
tonomy, and  with  its  millions  of  people  all  free  and  yet  all  re- 
strained by  those  limitations  which  make  men  free,  is  due  to  the 
wisdom  of  the  fathers  in  lodging  the  ultimate  protection  of  the 
Constitution  in  judicial  authority,  and  thus  saving  the  confusion 
and  conflict  from  which  the  destruction  of  our  institutions  would 
otherwise  have  arisen." 

There  is  no  detraction  from  that  wisdom  in  saying  that  lawyers 
were  among  those  most  prominent  in  formulating  and  breathing 
the  spirit  into  that  remarkable  instrument,  and  that  in  so  leaving 
it  to  be  protected  by  the  courts  they  placed  it  under  the  guardian- 


248       WORLD'S  INSURANCE  CONGRESS 

ship  and  protection  of  American  lawyers.  And  there  is  no  less 
marvel  in  the  reflection  how  loyally  and  faithfully  the  American 
lawyers  have  fulfilled  their  great  trust  and  discharged  their  tre- 
mendous responsibility.  With  unwavering  and  surpassing  fidelity 
to  its  true  purpose  and  spirit,  the  American  lawyers  have  con- 
strued, applied  and  moulded  the  Constitution  about  the  varying 
stupendous  changes  in  our  relations. 

Mighty  struggles  have  ensued  from  their  disputes  over  the  Con- 
stitution, but  never  from  their  assaults  upon  the  Constitution. 
Whatever  the  dispute,  every  lawyer  disputant  has  urged  the  main- 
tenance of  the  Constitution.  And  so  the  Constitution  and  our  con- 
stitutional government  have  been  preserved  through  a  centur}'- 
and  a  half  of  the  tempestuous  community  life  of  a  people  gathered 
from  every  nation  of  the  globe.  And  so  it  stands  to-day,  in  pris- 
tine strength  and  in  a  glory  made  sacred  b.y  efficiency  and  endur- 
ance through  time,  a  monument  to  the  patriotic  loyalty  and  stern 
convictions  and  courage  of  the  American  Bar,  which  led  in  pre- 
serving it,  as  M'ell  as  to  the  lawyers  among  the  fathers  who  made 
it. 

Standing  for  orderly  government  under  the  Constitution  and 
the  Law,  the  American  lawyer  fears  no  man  or  set  of  men,  high 
or  low.  He  acknowledges  no  higher  power.  Without  cringing  or 
fawning,  without  apology,  he  opposes  every  assault  on  the  Consti- 
tution or  the  Law ;  and  the  mightier  the  assailant,  the  more  plau- 
sible or  insidious  the  assault,  the  quicker,  the  more  forcible  is  the 
lawyer's  response. 

When  an  ex-Governor  of  an  important  State,  in  a  Convention 
of  Governors,  said :  ' '  Where  mobs  are  no  longer  possible,  liberty 
will  be  dead,"  the  response  to  so  shocking  a  doctrine  was  at  once 
so  in  the  hearts  and  minds  and  on  the  lips  of  the  people  that 
lawyers  felt  no  call  to  the  defense  of  constitutional  government. 

But  when  an  ex-President  of  the  United  States,  so  distinguished 
and  so  brilliant  that  every  word  he  utters  commands  the  attention 
of  the  people,  with  plausible  eloquence  advocated  the  proposed 
recall  of  judicial  decisions,  the  American  Bar,  in  spite  of  the 
prominence,  influence  and  power  of  supporters  of  such  a  pro- 
posal, and  in  spite  of  the  popularity  of  such  proposed  appeal  from 
the  courts  to  the  people,  instantly  and  emphatically  denounced  it, 
and  so  completely  cleared  the  American  vision  to  the  unworthiness 
of  such  a  doctrine,  that  the  recall  of  judicial  decisions  now  has 
few  if  any  supporters. 

Likewise  we  witnessed  the  instinctive,  instant  opposition  of  the 
American  Bar,  as  represented  in  its  National  Association,  when 
the  Chief  Executive  of  the  Nation,  in  characteristic,  delightful  ora- 
tory, which  we  all  would  like  to.  but  none  of  us  can,  imitate,  sug- 
gested that  law  and  justice  should  be  sensed  in  some  way  from 
the  feelings  of  the  people,  rather  than  from  precedents  and  stat- 
utes. Relating  his  conversation  with  a  lawyer,  he  quoted  his 
own  question:     "After  all,  isn't  our  object  justice?"     And  the 


WORLD'S  INSURANCE  CONGRESS  249 

lawyer  replied:  "God  forbid!  we  should  be  very  much  confused 
if  we  made  that  our  standard.  Our  standard  is  to  find  out  what 
the  rule  has  been  and  how  the  rule  that  has  been  applied  to  the 
case  that  is."  He  then  stated  he  would  "hate  to  think  that  the 
Law  is  based  entirely  on  has-beens"  and  "would  hate  to  think 
that  the  Law  did  not  derive  its  impulse  from  looking  forward, 
rather  than  looking  backward,  or,  rather  that  it  did  not  derive 
its  instruction  from  looking  about  and  seeing  what  the  circum- 
stances of  man  actually  are  and  what  the  impulses  of  justice  nec- 
essarily are";  stating  he  had  found  "the  flame  of  moral  judgment 
burned  just  as  bright  in  the  man  of  humble  life  and  limited  ex- 
perience, as  in  the  scholar  and  man  of  affairs."  He  said  he  "would 
like  his  voice  always  to  be  heard  not  as  a  witness,  not  as  speak- 
ing in  his  own  case,  but  as  if  it  were  the  voice  of  men  in  general, 
in  our  courts  of  justice,  as  well  as  the  voice  of  the  lawyers  re- 
membering what  the  Law  has  been." 

These  words  fell  on  the  ears  of  the  members  of  the  American 
Bar  Association,  who  yield  to  none  in  admiration  for  the  personal 
character,  the  learning,  the  distinguished  attainments  and  the  pa- 
triotism of  the  speaker  or  in  profound  respect  for  his  exalted 
office.  They  fell,  nevertheless,  on  the  ears  of  those  who  believe  as 
they  believe  in  their  Country's  strength,  that  "Our  standard 
is  to  find  out  what  the  rule  is,  not  has  been,  and  how  the  rule  that 
is,  not  has  been,  applies  to  the  case  that  is."  They  look  for  guid- 
ance to  principles  as  illustrated  in  precedents.  They  seek  to  apply 
them  to  facts  and  conditions  as  they  find  them.  They  look  for 
guidance  to  statutes  and  they  look  to  statutes  for  any  changes 
in  established  rules.  They  stubbornly  refuse  to  recognize  any  other 
' '  flame  of  moral  judgment. 

At  the  first  convenient  opportunity  the  alarmed  feeling  of  the 
American  Bar  seemed  to  find  utterance  in  the  words  of  one  who 
said :  "So  far  as  the  thought  implies  a  lofty  purpose  to  promote 
justice  and  prevent  the  perpetration  of  wrongs,  either  public  or 
private,  the  Court  and  the  Bar  will  heartily  respond,  and  the  his- 
tory of  the  court  is  the  best  vindication  of  the  doctrine ;  but  if  it 
implies  that  the  judges  are  at  liberty  to  disregard  fixed  principles 
and  substitute  an  undefined  and  intangible  popular  apprehension 
of  what  a  decision  ought  to  be,  which  will  vary  with  the  sensitive 
ness  of  each  individual  judge,  then  the  doctrine  is  full  of  peril. 

And  so,  whenever  and  wherever  the  attack  may  be,  and  whoever 
may  be  the  assailant,  however  lofty  his  motives,  the  American  Bar 
has  stood  jealously,  unflinchingly,  aggressively  and  triumphantly 
against  any  and  all  efforts  to  destroy  or  to  tamper  with  the  vital, 
fundamental,  underlying  foundation  on  which  this  Nation  was  con- 
structed and  is  maintained,  of  a  constitutional  government  and 
a  government  by  Law. 

And  now,  on  an  occasion  when  all  classes  are  called  to  report 
their  labors  in  "Prevention  and  Construction,"  it  is  not  inappro- 
priate to  remind  you  that  all  your  labors  would  have  been  in  vain, 


250       WORLD'S  INSURANCE  CONGRESS 

except  for  the  prevention  of  disorder  or  anarchy,  and  the  con- 
servation of  order  and  orderly  government,  and  these  are  due 
to  tlie  initiative,  the  example  and  the  leadership  of  the  American 
Bar. 

This  does  not  imply  responsibility  of  the  lawyer  for  the  condition 
of  the  laws  and  constitutions  as  they  exist.  Lawyers  may  differ 
as  others  differ  as  to  the  wisdom  of  certain  laws.  Lawyers  dis- 
pute over  what  the  law  is.  Where  lawyers  stand,  as  one  man,  is 
for  tlie  Law  and  the  Constitutional  limitations  on  the  Law,  and  our 
orderly  mode  of  interpreting  and  applying  both.  It  may  be  that 
lawyers,  with  their  technical  training  and  as  legislators,  as  pub- 
lic officials  and  as  advisors,  should  be  blamed  more  than  others 
for  defects  in  the  Law,  for  unwholesome  constitutional  provisions, 
for  perversions  of  justice  under  the  Law.  As  to  all  such  accusa- 
tions, let  others  defend.  I  am  asserting  the  preeminence  of  the 
lawyer  in  the  preeminent  function  of  conservator  of  constitutional 
government  and  of  the  law. 

It  has  been  said,  and  it  is  true,  that  lawyers  are  not  naturally 
reformers.  They  are  naturally  against  change.  They  are  natur- 
ally reactionaries.  Their  time  is  employed  in  their  eases.  The  suc- 
cessful lawyer,  like  other  successful  men,  is  usually  satisfied  with 
the  conditions  under  which  he  has  attained  success.  Considering 
that  we  average  about  twelve  thousand  new  statutes  and  thirteen 
thousand  new  reported  decisions  a  year,  it  may  be  understood  how 
the  lawyer  has  little  time  for  altruistic  or  utilitarian  philosophy. 

Lawyers  as  a  class  are  not  popular.  Yet  the  confidence  and  trust 
reposed  in  them  by  others  demonstrate  the  esteem  in  which  they 
are  really  held ;  and  every  man  has  lawyers  among  his  friends  and 
acquaintances,  w-hom  he  respects  and  admires.  It  has  been  said 
that  ' '  for  every  detractor  we  find  a  thousand  men  and  women  who 
trust  their  lawyers  implicitly." 

A  writer  of  the  first  rank  of  present  day  fiction,  in  attempting 
to  tpyify  the  life  of  "a  successful  lawyer,"  has  him  make,  when 
in  his  prime,  this  somewhat  paradoxical  statement:  "What  did  I 
know?  A  system  of  law  inherited  from  another  social  order  that 
was  utterly  unable  to  cope  with  the  complexities  and  miseries  and 
injustice  of  a  modern  industrial  world.  ...  I  had  spent  my  days 
in  mastering  an  inadequate  and  archaic  code — why?  In  order 
that  I  might  learn  how  to  evade  it." 

It  would  be  interesting,  had  we  the  time  and  disposition,  here 
to  discuss  the  "successful  lawyer,"  his  merits  and  demerits  in 
his  relations  to  our  institutions.  Whatever  they  may  be,  it  may  be 
said  that  the  lawyer,  with  liis  technical  knowledge,  is  best  adapted 
to  reform  procedure,  with  his  developed  sense  of  justice  is  best 
equipped  to  frame  new  laws,  and,  with  his  continuous  studies  of 
particular  social  conditions,  is  best  fitted  to  formulate  constitu- 
tional changes  for  the  promotion  of  social  equality  and  justice. 

liike  others,  however,  he  is  too  busy  trying  to  make  a  living, 
in  the  way  ordained  by  mankind,  to  have  time  for  much  work  for 


WORLD'S  INSURANCE  CONGRESS  251 

the  general  benefit  of  mankind.  Liice  otliers,  too,  in  a  country 
where  equal  opportunity  is  the  proud  boast  that  settles  all  ques- 
tions about  equal  rights,  and  where  at  the  same  time  the  fulfill- 
ment of  the  injunction,  *'Love  thy  neighbor  as  thyself"  is  so  fondly 
hoped  for,  the  lawyer  finds  himself  in  constant  battles  under  the 
banners  "The  Survival  of  the  Fittest"  and  "To  the  Victors  Be- 
long the  Spoils." 

Dominating  all  else  in  the  lawyer  is  unswerving  loyalty  to  his 
client.  Against  him  in  every  cause  is  just  as  loyal  and  faithful 
a  lawyer,  with  the  same  clear  conscience.  Each,  in  demanding 
what  he  thinks  his  client's  due,  necessarily  tries  to  prevent  the 
other  having  what  he  thinks  his  due.  The  respect  and  sometimes 
the  affection  of  the  victor  and  the  vanquished  for  each  other  is 
admirable  and  proverbial.  Still  their  struggle  is  like  the  competi- 
tion of  merchants  and,  except  where  life  or  liberty  is  involved, 
the  end  sought  is  satisfying  a  client's  craving  for  the  "means 
of  existence"  or  "root  of  all  evil,"  whichever  way  you  care  to 
put  it. 

What  marvel,  then,  if  the  lawyer,  finding  humanity  in  conflict 
rather  than  harmony,  realizes  that  he  will  survive  or  succumb, 
according  to  the  world's  standards  of  success?  What  marvel, 
then,  if  the  mainsprings  of  that  success  tend  to  stifle  in  him  the 
fulfillment  of  the  Scriptural  injunction? 

If  conditions  under  the  Constitution  and  the  Law  are  unsatis- 
factory, why  blame  the  lawyer  more  than  others?  His  business  is 
to  enforce  the  Constitution  and  the  Law  as  he  finds  them — not  to 
make  them.  If  there  are  "impulses  of  justice"  not  found  in  the 
constitutions  and  the  laws,  then  the  lawyer  emphatically  asserts 
they  cannot  be  enforced.  If  they  ought  to  be  there,  it  is  human- 
ity's fault  they  are  not.  And  the  lawyer  will  forever  assert  that 
until  humanity  puts  their  impulses  into  the  Constitution  and  the 
Law,  their  impulses  cannot  control  humanity.  Do  not  blame  the 
lawyer  for  the  omission,  except  as  you  blame  yourselves  and  the 
rest  of  humanity. 

Great  men  and  patriots  may  proclaim,  and  universities  of  learn- 
ing may  instill  into  young  minds,  that  the  Constitution  is  an  obsta- 
cle in  National  progress  and  development.  And  though  the  people 
generally  should  unite  to  destroy  it,  the  American  Bar  will  be 
found  standing  by  the  Constitution  and  the  Law,  and,  in  the  lan- 
guage of  another,  "as  long  as  the  traditions  of  the  American  law- 
yer survived,  they  would  suffice  to  affoi-d  energy-  and  insight,  from 
the  exertion  of  which  a  new  and  enduring  edifice  of  liberty  and 
representative  government  would  arise." 

The  people  of  this  Country  can  do  anything  under  the  Constitu- 
tion and  the  Law.  but  they  must  have  or  make  the  Constitution 
and  the  Law  authorizing  it,  before  they  do  it. 

Let  laymen  and  lawyer  alike  look  in  the  face  the  joint  and  sev- 
eral responsibility  of  all  and  of  each  for  our  Constitution  and  our 
laws.     Let  our  resolve  be  that  all  shall  study  our  conditions  and 


252  WORLD'S  INSURANCE  CONGRESS 

see  wherein  the  Constitution  is  "the  broad  highway  through  which 
alone  true  progress  may  be  enjoyed";  and  to  see  wherein  the  Con- 
stitution or  the  Law  should  be  changed,  if  change  is  necessary,  to 
enable  us  to  fulfill  the  scriptural  command  which  we  feel  in  our 
souls  should  penueate  all  human  activities. 

It  has  been  said  that  it  is  not  true  that  "Christianity  has  been 
tried  and  found  wanting,"  but  that  "Christianity  has  been  found 
difficult  and  not  tried."  Let  the  people,  through  their  constitu- 
tions and  laws,  reform  their  institutions,  if  they  may,  in  a  man- 
ner better  calculated  to  carry  out  the  simple  but  comprehensive 
lessons  of  the  ]\Iaster.  The  lawyers  will  not  thwart  them.  The 
lawyers  will  enforce  obedience  to  the  Law.  He  said:  "Woe  unto 
ye  lawyers :  ye  have  taken  aM^ay  the  key  of  knowledge :  ye  enter 
not  in  yourselves  and  them  that  were  entering  in  ye  hindered." 
But  He  said:  "Think  not  that  I  am  come  to  destroy  the  Law,  or 
the  Prophets:  I  am  not  come  to  destroy,  but  to  fulfill."  It  was 
not  the  Law  He  condemned,  but  the  lawyers'  misinterpretation  and 
misuse  of  the  Law. 

To-day  the  lawyer  stands  for  enforcement  of  the  Law,  not  for 
its  evasion.  And  the  lawyer  will  stand  with  all  others  for  the 
maintenance  and  administration  of  constitutions  and  laws  which 
may  best  promote  that  all-inspiring  command,  ' '  Love  thy  neighbor 
as  thyself." 


AMERICAN  INSTITUTE  OF  BANKING 

By  James  K.  Lynch 
President,   American  Bankers'  Association 

When  I  was  invited  to  read  a  paper  on  the  American  Institute 
of  Banking  before  this  Convention,  the  veteran  insurance  man 
who  did  me  the  honor  also  wrote  a  letter  in  which  he  suggested 
that  I  would,  without  doubt,  be  able  to  deduce  from  the  subject 
the  importance  of  insurance  as  a  stabilizing  influence  in  the  com- 
mercial world. 

No  banker  has  any  doubts  on  this  matter,  nor  does  he  require 
to  be  told  that  his  credits  are  not  properly  protected  unless  cov- 
ered by  insurance.  The  merchant  must  cover  his  stock  of  goods 
by  fire  insurance;  the  builder  must  give  surety  bonds  to  insure 
the  completion  of  his  contracts;  goods  in  transit  by  sea  must  be 
safeguarded  by  marine  insurance;  the  honesty  of  the  banker's  offi- 
cers, tellers  and  clerks,  as  well  as  that  of  the  responsible  agents 
of  his  customers,  must  be  insured  to  prevent  loss  and  perhaps  in-^ 
solvency  through  defalcation.  Every  employer  of  labor,  and  all 
those  who  come  into  contact  with  the  public  in  such  manner  as  to 
involve  risk  of  accident,  must  be  protected  l)y  indemnity  insur- 
ance, and  finally  the  lives  of  the  men  whose  guidance  is  essential 


WORLD'S  INSURANCE  CONGRESS  253 

to  the  completion  of  large  enterprises  should  be  insured.  As  hu- 
man affairs  are  always  incomplete,  and  every  business,  whether 
large  or  small,  depends  for  its  success  on  the  life  of  some  indi- 
vidual, life  insurance  may  be  said  to  be  a  universal  protection 
which  every  business  should  have.  I  have  not  mentioned  various 
special  forms  ,such  as  cyclone,  earthquake  and  lightning  insurance, 
which  conditions  make  necessary  in  particular  places,  and  I  am 
sure  that  many  of  my  hearers  can  greatly  extend  the  list.  How- 
ever inadequate  this  list  may  be,  it  will  serve  to  illustrate  the  fact 
that  the  modern  banker  demands  full  information  as  to  insurance 
carried  in  every  credit  statement,  and,  where  it  does  not  appear 
adequate,  asks  for  additional  protection. 

What  all  this  has  to  do  with  the  American  Institute  of  Banking, 
I  am  quite  unable  to  see,  but  I  will  proceed  to  lay  the  facts  before 
you,  and  your  minds,  trained  in  the  science  of  assurance,  will 
doubtless  supplement  my  deficiency  in  vision. 

The  American  Institute  of  Banking,  a  section  of  the  American 
Bankers  Association,  was  organized  in  1902,  the  question  of  the 
organization  having  been  first  discussed  at  the  convention  of  the 
parent  organization,  held  in  Richmond,  Virginia,  in  1900.  The 
avowed  purpose  of  the  Institute  was  the  Education  of  Bankers  in 
Banking.  It  might  be  restated  as  the  Making  of  Bankers  out  of 
Bank  Clerks. 

The  membership  in  August,  1915,  was  fifteen  thousand,  six  hun- 
dred and  six,  divided  into  sixty  chapters  and  one  correspond- 
ence chapter  of  over  thirteen  hundred  members.  Each  chapter 
elects  its  own  officers  and  also  delegates  to  the  general  conven- 
tion which  elects  the  officers  and  governors  of  the  National  body. 
The  Institute  chooses  a  representative  to  the  Executive  Council 
of  the  American  Bankers  Association,  of  which  the  Institute  is  a 
section.  The  Educational  Director  of  the  Institute  resides  in  New 
York  and  has  office  with  that  of  the  General  Secretary  of  the  Amer- 
ican Bankers  Association,  so  that  the  relations  are  close,  and  these 
relations  are  further  cemented  by  the  fact  that  the  Institute  Bulle- 
tin, giving  news  of  particular  interest  to  the  members,  is  incorpo- 
rated with  the  journal  of  the  American  Bankers  Association  and 
is  mailed  regularly  to  each  member  of  both  Associations.  It  might 
be  proper  to  say  here,  that  the  members  of  the  American  Bankers 
Association  are  all  banks  or  banking  firms,  while  the  membership 
in  the  Institute  is  individual  and  is  composed  of  bank  clerks  and 
officers.     So  much  for  the  machinery,  and  now  for  the  work. 

Each  chapter  takes  up  a  course  which  is  divided  into  two  parts : 

Part  One:  Banking  and  Economics,  subdivided  into  Banks  and 
Banking  and  Loans  and  Investments. 

Part  Two :  Banking  and  Commercial  Law,  which  subdivides  into 
Commercial  Law  and  Negotiable  Instruments. 

All  literature  used  is  revised  by  a  Board  of  Regents,  which  con- 
sists of  two  college  professors,  two  bankers  and  the  Educational 
Director,  who  is  the  only  salaried  officer.     Those  who  have  satis- 


254       WORLD'S  INSURANCE  CONGRESS 

factorily  completed  the  course  of  study  receive  a  diploma  evidenc- 
ing the  fact. 

The  study  courses  are  by  no  means  play,  and  are  taken  very 
seriously.  In  addition,  the  chapters  have  stated  meetings,  at  which 
addresses  are  given  by  local  or  other  bankers  of  more  or  less  prom- 
inence and  experience,  and  lectures  by  professors  in  the  nearby 
Universities  on  financial,  economic  and  other  kindred  subjects. 
The  chapters  also  maintain  debates  on  financial  questions,  through 
which  means  the  members  acquire  the  ability  to  speak  on  their  feet, 
as  well  as  to  think  quickly  and  coherently — all  valuable  accom- 
plishments for  men  in  any  walk  of  life. 

The  graduates,  who  now  number  over  fifteen  hundred,  keep  up 
their  interest  through  the  study  of  more  advanced  economic  topics, 
which  they  discuss  in  chapter  forums.  The  Savings  Bank  Section 
of  the  American  Bankers  Association  has  recently  turned  over 
their  campaign  for  Thrift  to  the  graduates,  who  give  talks  before 
public  schools  and  other  assemblies  on  this  most  important  ques- 
tion. 

This  is  a  bare  and  rather  imperfect  statement  of  the  work  done 
by  the  Institute,  and  we  may  consider  results  already  accom- 
plished, those  to  be  expected,  and  the  causes  that  lead  to  its  for- 
mation and  which  have  contributed  to  its  development.  We  must 
recall  that  this  is  a  very  large  country  with  many  resources  un- 
developed or  but  partially  developed,  and  that  to  keep  pace  witl^ 
the  increase  in  population  and  wealth,  has  required  a  great  in- 
crease in  banking  facilities.  Banks  have  multiplied  much  more 
rapidly  than  trained  men  could  be  found  to  manage  them,  so  that 
men  from  all  walks  of  life  have  become  bankers  on  short  notice. 
As  the  crossroads  station  develops  into  a  village,  the  countrj^  store- 
keeper becomes  the  banker,  and  finally  when  a  real  bank  is  incor- 
porated, he  may  give  up  the  store  to  take  the  position  of  presi- 
dent. When  a  rival  bank  is  started,  a  retired  farmer  or  some  other 
local  man  of  means  and  leisure  takes  the  presidency.  IMen  so 
selected  are  apt  to  be  shrewd  .judges  of  credit,  and  long  residence 
in  the  community  makes  them  walking  encyclopedias  with  regard 
to  the  financial  condition  of  the  inhabitants.  They  seldom  err  on 
the  side  of  making  unsafe  loans,  but  are  very  likely  to  do  so  in 
loaning  too  much  of  the  deposits  and  in  tying  up  the  assets  in 
loans  that  are  stickers,  which  is  only  another  way  of  saying  that 
they  are  quite  lacking  in  banking  experience  and  banking  instinct. 
Of  the  technical  and  clerical  side  of  the  business,  they,  of  course, 
know  nothing,  and  they  are  fortunate  if  they  succeed  in  getting 
a  young  man  who  has  had  fair  training  as  a  clerk  in  some  neigh- 
boring bank,  to  take  the  position  of  cashier.  In  too  many  cases, 
his  training  is  limited,  and  the  clerks  to  whom  he  tries  to  teach 
the  rudiments  of  banking  lore  seldom  get  beyond  their  teacher. 

It  is  for  such  cases,  and  there  are  hundreds  if  not  thousands 
of  them,  that  the  correspondence  chapter  was  devised.  It  gives 
the  seeker  for  knowledge  an  opportunity  to  acquire  it  without  the 


WORLD'S  INSURANCE  CONGRESS  255 

wasted  time  that  must  accompany  unaided  effort.  It  is  generally 
recognized  that  the  best  banking  training  is  to  be  had  in  a  compara- 
tively small  office,  say  one  employing  from  ten  to  twenty-five  clerks. 
Here  the  necessities  of  the  daily  work  compel  the  clerks  to  become 
familiar  with  all  that  is  done  in  the  bank ;  every  one  has  to  help 
during  rush  seasons  in  doing  whatever  there  is  to  be  done.  Work 
is  doubled  or  trebled  in  vacation  times,  or  when  cases  of  illness 
occur,  so  that  before  many  years  the  competent  boy  who  is  not 
afraid  of  work  has  served  in  every  capacity.  The  limitations  are 
to  be  found  in  the  degree  of  training  and  ability  possessed  by  the 
head  of  the  office,  and  also  in  his  capacity  for  securing  discipline. 

The  problem  in  the  large  metropolitan  bank  is  quite  different. 
With  a  force  of  from  fifty  to  five  hundred  men,  the  necessity  for 
departmental  organization  is  evident,  and  the  tendency  is  to  de- 
velop, not  all-round  bank  men,  but  experts  in  some  specialty.  The 
competition  of  the  adding  machine  seems  to  make  of  the  men  cogs 
in  a  machine,  and  the  time  comes  when  whatever  stock  of  initiative 
a  boy  may  have  had  when  he  began  work  has  disappeared,  and  he  is 
in  fact  little  more  than  a  machine.  The  office  manager,  if  far- 
sighted,  will  sacrifice  temporary  efficiency  for  the  ultimate  good, 
not  only  of  the  men,  but  of  the  bank,  by  moving  them  about  from 
time  to  time  and  thus  securing  a  greater  number  of  men  who  can 
be  depended  on  in  an  emergency.  None  the  less,  the  tendency  is 
in  the  other  direction,  and  there  is  much  to  be  said  against  dis- 
turbing a  man  who  is  doing  his  work  excellently  well  by  putting 
him  in  a  position  where  he  is  again  a  beginner. 

The  Institute  gives  the  men  an  outlook  beyond  the  cages  in 
which  they  work;  it  shows  them  the  relation  of  their  particular 
task  to  the  whole,  and  it  helps  to  keep  their  minds  flexible,  to  pro- 
long the  time  during  which  they  have  initiative,  and  to  give  them 
the  opportunity  to  rise  to  the  higher  positions. 

It  is  not  to  be  supposed  that  all  members  of  the  Institute  take 
their  work  as  seriously  as  they  might,  and  a  large  proportion  of 
them  do  not  complete  the  courses  of  study,  but  the  diploma  is  by 
no  means  a  measure  of  the  work  that  has  been  accomplished.  The 
opportunity  to  talk  things  over  with  the  men  from  other  banks 
is  in  itself  a  valuable  aid  to  education  and  one  that,  so  far  as 
I  have  heard,  has  never  been  abused.  The  men  seem  to  recognize 
the  limits  that  should  not  be  passed,  and  they  discuss  methods  and 
systems  without  touching  on  business  secrets,  either  those  of  the 
bank  or  the  bank's  customers.  The  lectures  are  generally  well 
attended,  and  addresses  by  men  of  note  in  the  banking  world  can 
be  depended  on  to  draw  out  good  audiences.  The  best  evidence 
of  the  success  of  the  Institute  training  is  found  in  the  steadily  in- 
creasing number  of  graduates  who  are  taking  important  positions 
in  the  management  of  the  leading  banks  throughout  the  country. 

When  the  first  chapters  of  the  Institute  were  founded,  the  older 
bankers  were  a  little  disposed  to  take  the  movement  as  something 
of  a  joke,  and  it  was  sometimes  referred  to  as  the  Bank  Clerk's 


256       WORLD'S  INSURANCE  CONGRESS 

Union.  This  attitude  nowhere  lasted  for  any  considerable  time, 
and  has  now  entirely  changed.  In  San  Francisco  and  in  many 
other  cities,  the  Clearing  House  pays  a  portion  of  the  expense  of 
the  chapter,  and  the  associated  savings  banks  also  contribute.  In 
order  to  encourage  the  junior  clerks  to  join,  the  dues  are  fixed  at 
50e.  a  month,  and  the  sum  so  raised  is  manifestly  insufficient  to 
provide  suitable  quarters  and  to  pay  necessary  expenses.  j\Iany 
of  the  banks  also  pay  the  dues  of  the  boys  who  are  getting  the 
smaller  salaries,  although  it  is  a  fact  that  the  boys  who  pay  their 
own  way  are  the  more  zealous  workers.  Still,  as  boys  are  taken  into 
banks  as  young  as  fifteen  years,  and  at  salaries  as  low  as  $25  a 
month,  it  is  hardly  to  be  expected  that  they  can  pay  the  dues  from 
the  first. 

The  work  already  accomplished  gives  promise  of  much  greater 
achievement  in  the  future,  and  I  believe  that  in  the  Institute  we 
have  the  means  by  which  will  be  developed  a  body  of  educated  and 
trained  bankers  who  will  give  to  the  banking  business  in  this 
country  a  standing  which  it  has  not  heretofore  enjoyed. 

There  has  been  some  complaint  that  our  banks  produce  trained 
clerks  but  do  not  produce  good  business  men,  that  is,  men  pos- 
sessed of  sound  judgment,  and  that  business  men,  men  trained  in 
other  mercantile  lines,  must  be  found  to  manage  the  banks.  The 
earlier  years  of  a  man's  work  in  a  bank  are  spent  in  a  deadening 
routine,  which  has  but  little  in  it  to  develop  business  ability,  and 
it  is  the  exceptional  one  who  can  emerge  from  it  with  any  initiative 
left.  To  some  extent  the  bank  managers  and  directors  are  respon- 
sible through  adhering  too  closely  to  the  rule  of  seniority  in  mak- 
ing promotions  and  feeling  that  the  boys  must  be  given  some  years 
of  drudgery  before  they  are  fit  for  responsibility.  The  capacity  to 
work,  to  do  drudgery,  is  indeed  a  valuable  possession,  but  beware 
of  keeping  the  boy  too  long  at  it.  for  if  you  do,  you  run  the  risk 
of  losing  something  much  more  valuable ;  I  have  called  it  initiative, 
perhaps  the  common  word  "ginger"  better  expresses  what  I  mean. 
Send  the  boy  ahead  as  fast  and  as  far  as  he  will  go,  even  if  he 
does  make  some  mistakes;  get  the  benefit  of  the  energy  and  the 
enthusiasm  of  youth  while  it  lasts,  for  when  once  gone  it  returns 
no  more. 

Possibly  this  is  the  place  where  the  Institute  really  has  some- 
thing to  say  to  the  Insurance  men. 


AMERICAN  INSTITUTE  OF  ARCHITECTS 

By  R.  Clipston  Sturgis 
President 

I  feel   it   an  honor  as  well  as  a  privilege  to  have  the  oppor- 
tunity  of   putting   before   the    insurance    interests   of  the   world 


WORLD'S  INSURANCE  CONGRESS  257 

what  in  a  modest  way  has  been  done  by  the  institution  which  I 
represent — the  American  Institute  of  Architects — toward  the  work 
in  which  you  are  interested — the  prevention  of  fire,  the  prevention 
of  accident  and  tlie  prevention  of  disease. 

It  comes  very  close  to  the  work  of  every  architect,  because  there 
is  hardly  anything  that  goes  on  in  our  civilized  world  that  doesn  't 
touch  us  and  concern  us  very  closely.  We  are  alternately  blamed 
in  our  profession  either  for  claiming  that  we  know  it  all,  or  else 
for  seeming  altogether  too  inquisitive  and  wanting  to  know  it  all. 
I  can  remember  various  instances  where  I  have  attempted  to  get 
information  which  seemed  to  me  quite  vital  to  the  work  I  was 
doing,  and  I  have  been  very  politely  told  that  it  was  none  of  my 
business.  In  hospitals,  for  instance,  when  we  are  attempting,  we 
will  say,  to  prevent  the  carrying  of  disease,  either  by  physicians 
or  nurses  who  came  into  the  contagious  wards,  we  were  anxious 
to  know  just  what  the  process  was  when  the  doctor  came  in  and 
prepared  to  go  into  the  contagious  portion  of  the  hospital,  and  how 
he  disinfected  himself  when  he  came  out  again,  but  were  met  by 
a  blank  wall.  They  said  "We  will  tell  you  what  to  do — just  go 
ahead  and  do  it. ' ' 

Now  all  this  preamble  is  simply  to  let  you  feel  that  architects 
necessarily  come  into  these  subjects  in  which  you  are  interested 
from  the  ground  up,  so  to  speak.  The  moment  we  start  in  our 
business  we  have  got  to  take  up  these  various  things  you  are  in- 
terested in.  Good  construction,  the  prevention  of  fire,  accidents, 
and  the  prevention  of  diseases,  are  all  things  that  the  members  of 
the  American  Institute  of  Architects,  and  every  architect  Avho 
practices  his  profession,  must  have  in  every-day  use.  One  almost 
might  say  that  the  architect  is  more  interested  in  hygiene  than 
the  doctors  or  the  health  departments;  because  as  a  matter  of  fact 
he  is  perfectl}^  disinterested,  he  lives  with  it  the  whole  time,  and 
has  it  constantly  put  up  to  him.  Every  building  that  he  builds 
has  something  to  do  with  one  or  the  other  of  those  questions. 

I  was  going  to  say,  and  in  fact  I  will  say,  that  we  had  looked 
in  vain  to  the  insurance  companies  for  the  lead  in  good  construc- 
tion, and  I  think  that  is  to  a  certain  extent  true.  I  do  not  think 
it  is  the  fire  insurance  companies  who  were  the  first  ones  to  push 
towards  better  construction.  It  was  architects  and  builders,  be- 
cause it  was  demanded  by  the  owners  and  because  it  was  demanded 
by  the  common  sense  that  every  architect  has  got  to  have.  He 
may  design  well,  he  may  construct  well  and  economically,  but  I 
assure  you  that  he  is  no  good  whatever  unless  he  has  a  good  foun- 
dation of  common  sense ;  and  that  is  what  it  means  when  we 
argue  with  the  owner  that  it  isn't  common  sense  for  him  to  bnild 
substantial  walls  to  his  building  and  frame  the  whole  thing  inside, 
floors  and  partitions,  with  wood.  Not  only  from  the  fire  point 
of  view,  but  because  he  has  a  construction  that  is  moving  all  the 
time  with  heat  and  cold  and  dryness  and  moisture,  and  in  the 
course  of  a  few  j^ears  his  repairs  will  outweigh  the  original  sav- 


258       WORLD'S  INSURANCE  CONGRESS 

ing.  So  we  approach  it  from  another  point  of  view  than  merely 
that  of  insurance.  There  are  many  classes  of  buildings — say, 
heavy  mill  construction — where  it  might  seem  perfectly  reasonable 
from  the  safety  point  of  view,  as  far  as  fire  is  concerned,  but  where 
it  would  not  be  economical  for  the  owner  in  the  long  run. 

There  is  no  question  to-day  but  what  the  insurance  companies 
throughout  the  country  are  fully  alive  to  the  importance,  the  ab- 
solute importance,  of  safe  construction,  and  as  this  is  gradually 
hammered  home  to  the  people,  gradually  we  will  be  able  to  get 
better  insurance  conditions. 

At  present  our  policy  is  a  shortsighted  one,  and  one  which  it 
depends  on  both  of  us — insurance  people  and  architects  and  build- 
ers— to  set  right  if  we  can.  Nearly  all  of  our  cities  allow  wooden 
construction  in  the  immediate  outskirts,  even  if  they  don't  allow 
it  in  the  civic  centers.  That  wooden  construction  which  is  in 
the  immediate  outskirts  will  very  soon  be  in  the  city  itself — and 
it  isn't  that  it  is  a  menace  itself  to  itself.  If  it  simply  hurt  the 
man  whose  house  was  burned  up  it  would  be  of  very  little  mo- 
ment, but  it  threatens  the  whole  community ;  and  the  man  who 
goes  out  into  a  suburban  community  and  builds  reasonably,  with 
good  construction  of  brick  and  stone,  and  fairly  safe  as  far  as 
the  outside  is  concerned,  really  isn't  protected  at  all  if  he  is  sur- 
rounded by  other  buildings  M'hich  are  of  wood.  We  must  go  to 
the  root  of  the  matter  and  carry  that  sort  of  construction  right 
out  into  our  suburbs,  and  that  is  where  it  is  so  difficult  to  train 
our  people  to  know  what  is  right  for  them.  They  have  an  idea 
that  because  insurance  companies  pay  the  bills  thej^  don't.  There 
was  never  anything  in  the  world  more  false  than  that.  We  all 
pay,  and  if  the  rates  for  insurance  are  high  we  all  suffer,  and 
they  never  can  be  brought  down  until  the  general  plane  of  build- 
ing is  lifted  and  we  don't  have  such  multitudes  of  unsafe  buildings 
that  set  the  high  rates. 

The  architects  from  the  beginning  have  been  the  advocates  of 
better  construction,  and  in  many  ca.ses  the  argument  which  could 
be  brought  to  bear  would  be  lower  insurance  rates,  but  more  im- 
portant than  that  is  the  question  of  repair.  And  we  would  be 
more  successful  in  persuading  people  to  build  of  better  materials 
if  it  were  not  for  the  unfortunate  fact  that  our  people  are  such 
transitory  people.  Our  real  estate  men,  of  course,  as  you  know, 
will  build  up  a  section  and  they  will  build  it  up  with  the  sole 
purpose  of  getting  rid  of  it  as  quickly  as  they  can.  What  becomes 
of  the  buildings  after  two  or  three  years  is  a  matter  of  perfect 
indifference.  Their  prime  consideration  is  that  they  look  well 
when  first  put  up,  that  they  will  the  more  readily  reap  good  profits. 

But  the  man  who  buys  his  home,  in  nine  cases  out  of  ton,  doesn't 
look  upon  it  as  a  permanent  home,  and  is  not  apt  to  look  upon  it 
even  as  a  permanent  investment,  his  idea  being  that  if  a  city 
is  growing  in  his  direction  the  real  estate  value  will  depend  upon 
the  land  much  more  than  the  house  thaf  is  on  it,  so  that  if  the 


WORLD'S  INSURANCE  CONGRESS  259 

property  appreciates  he  can  get  out  his  profit  even  if  the  house 
deteriorates.  Everybody  expects  to  move,  and  this  is  one  of  our 
great  difficulties  in  persuading  people  to  build  a  better  class  of 
house. 

I  think  you  will  see  that  architects  do  care  about  these  things 
that  you  are  interested  in,  and  that  they  have  always  been 
working  and  will  continue  to  work  for  better  and  safe  construc- 
tion. 

On  the  standpoint,  the  prevention  of  disease:  There  are  in- 
numerable branches  where  the  architect  has  his  own  particular 
work  to  do  in  regard  to  that,  and  you  might  rightly  say  that  we 
are  more  interested  than  doctors  and  health  officers.  Town  plan- 
ning, in  its  big,  broad  sense,  is  a  matter  of  hygiene,  as  well  as 
beauty.  From  town  planning  you  come  to  the  various  schemes 
for  the  development  of  domestic  living,  and  the  conditions  under 
which  the  people  live  in  close  and  congested  tenement  districts. 
There  the  architects  have  done  a  great  deal  in  bettering  condi- 
tions. The  same  is  true  of  schools,  which  during  the  last  twenty 
or  twenty-five  years  have  certainly  moved  from  a  condition  where 
they  were  purely  haphazard  to  buildings  that  are  now  accurately 
scientific  and  well  built,  particularly  with  regard  to  the  health 
of  the  pupils  in  them.  The  same  is  true  of  our  hospitals,  which 
have  advanced  by  leaps  and  bounds,  getting  cleaner,  more  whole- 
some, and  better  in  every  way.  The  same  is  true  of  our  churches 
and  our  factories.  In  the  development  of  those,  the  architects 
have  not  necessarily  taken  a  leading  part,  but  they  work  with 
the  people  who  are  leaders,  and  learn  from  them,  because  that  is 
what  we  are  doing  all  our  lives — continuing  our  education. 

The  various  buildings  which  house  those  who  are  on  the  public 
charge  have  been  changed  in  very  recent  years  from  conditions 
that  have  been  shocking  and  horrible  and  a  menace  to  the  com- 
munity, to  conditions  that  are  universally  growing  better  the 
whole  time,  and  it  is  almost  altogether  a  question  of  housing. 
With  our  poor,  with  the  insane,  and  with  the  criminal — once  put 
those  people  under  good  housing  conditions,  give  them  good  air 
and  plenty  of  it,  and  wholesome  food,  and  we  will  cure  many  of 
the  evils  that  exist,  and  cure  many  diseases. 

Architects  have  had  their  share  in  all  these  things,  and  it  is 
the  greatest  possible  pleasure  to  be  an  architect  and  have  a  share 
in  that  class  of  work,  but  of  course  the  real  glory  rests  with  the 
doctors  and  the  nurses  who  are  right  on  the  firing  line  in  all 
these  things. 

And  then  we  come  down  to  the  more  particular  things  that 
architects  study:  Light;  there  have  been  great  changes  in  the 
whole  treatment  of  light  in  the  last  ten  years.  Conditions  to-day 
are  nothing  like  what  they  were.  Ten  years  ago  you  never  saw 
the  skeleton  factory — totally  glass — as  it  is  to-day.  Men  thus  work 
under  wonderfully  improved  conditions  in  those  factories,  both 
with  regard  to  light  and  cleanliness.    The  same  is  true  of  artificial 


260       WORLD'S  INSURANCE  CONGRESS 

light,  which  has  been  studied  so  as  to  save  the  eyes  of  those  who 
have  to  work  under  artificial  light.  In  all  those  improvements, 
the  architect  has  had  his  share. 

Heat  has  been  studied,  so  as  to  try  to  give  air  that  is  warm, 
and  what  is  perhaps  more  important,  air  that  is  moist,  as  there 
is  nothing  so  harmful  as  dry  air.  Their  study  of  conditions  of 
warm  air,  I  think,  have  led  directly  to  this  movement  for  out-of- 
doors  and  fresh  air.  They  have  tried  to  reproduce  inside  the  con- 
ditions of  God's  own  air  outside,  and  when  they  have  come  just 
as  near  to  it  as  they  could,  they  have  said,  "What  is  the  matter 
with  the  outside  air?"  The  more  we  can  get  of  it  the  better  we 
are,  and  that  has  been  the  first  step  toward  out-of-door  life,  and 
that  is  what  is  going  to  do  more  for  this  country  than  probably 
any  other  one  thing. 

Again,  just  let  me  touch  on  this  temporary  character  of  our 
houses.  The  mere  desire  of  people  for  fresh  air  and  more  out- 
of-door  life  is  going  to  lead  people  with  better  means  of  communi- 
cation— which  we  now  have  to  move  a  little  farther  out,  and  to 
build  houses  with  more  land  about  them — and  the  moment  that 
is  accomplished,  your  man  is  going  to  begin  to  look  upon  that 
place  as  his  own,  because  he  is  going  to  begin  to  garden  and  im- 
prove out-of-doors,  and  as  soon  as  a  man  does  that  he  begins  to 
feel  that  he  is  in  a  permanent  home.  So  that  movement  is  going 
to  work  toward  greater  permanency  in  the  houses  that  we  build, 
and  so  by  gradual  steps  one  slides  from  a  dry  subject  like  insur- 
ance to  the  delights  of  the  country  and  out-of-doors  and  gardening 
and  all  those  things  that  make  life  worth  living. 

That,  Ladies  and  Gentlemen,  is  the  message  that  I  bring  to  you 
from  the  American  Institute  of  Architects. 


AMERICAN   INSTITUTE    OF    ELECTRICAL    ENGINEERS* 

By  John  A.  Britton 
President,  Pacific  Gas  and  Electric  Company 

As  a  representative  and  member  of  the  American  Institute  of 
Electrical  Engineers,  it  is  my  desire  to  express  what  I  believe  to 
be  the  sentiments  of  not  only  those  who  have  the  title  and  are 
termed  "Electrical  Engineers,"  but  also  all  persons  who  are  in 
any  way  whatever  identified  with  large  electrical  interests. 

Contemporaneous  with  the  introduction  of  electric  energy  for 
light,  heat  and  power  purposes  began  the  endeavor  to  secure  better 
protection  against  the  ravages  of  fire.  In  the  earlier  days  of  what 
is  now  perhaps  the  greatest  industry,  taken  collectively,  of  the 
twentieth  century,  protection  against  the  unknown  quantity  of 
electric  energy-  was  negligible.    Insulation  for  comparatively  small 

•  Not  Read. 


AA^ORLD'S  INSURANCE  CONGRESS  261 

voltages  was  an  assumed  rather  than  a  known  quantity  or  quality. 
As  the  art  progressed  to  the  limits  of  force,  adequate  provision 
along  similar  scientific  lines  was  not  made,  so  that  hazards  of 
electrical  installations  were  not  fully  understood  nor  compre- 
hended. But  as  this  science  developed,  so  developed  with  it  those 
concomitants  that  we  of  to-day  are  witnesses  of — buildings  of 
gigantic  size,  made  possible  only  by  the  utilization  of  electric  en- 
ergy in  transportation,  so  that  the  forty-story  building  becomes 
more  feasible,  and  practicable  than  was  the  four-story  building 
thirty  years  ago. 

The  force,  therefore,  of  electric  energy  has  produced  the  ad- 
vance in  synchronism  with  it  of  the  arts  and  sciences  to  meet  the 
demands  of  congested  centers  of  population,  thus  conserving 
ground  area  but  introducing  elements  of  risks  from  fires  and  ac- 
cidents that  are  the  direct  result  of  the  meeting  this  week  of  the 
organization  which  I  have  now  the  honor  of  addressing. 

The  increase  in  the  world's  population  centered  in  minority 
spaces  of  the  world,  presents  problems  of  care,  education  and 
growth  worthy  of  attention  from  the  world's  greatest  benefactors. 

The  insurance  idea  of  to-day  may  be  regarded  by  those  not  cog- 
nizant of  its  ulterior  motives  as  slightly  Utopian,  and  to  some 
it  may  perhaps  be  colored  with  the  idea  of  personal  gain ;  but  to 
those  who  have  a  larger  horizon  in  the  affairs  of  the  world  and  its 
people,  it  can  spell  but  one  word,  and  that  is  Civilization,  with 
all  the  meaning  that  its  bromide  term  expresses. 

Fires  cleanse,  but  to  a  greater  extent  destroy.  Fires  are  be- 
gotten of  carelessness  and  uncleanness.  Protection  against  fires 
implies  and  stands  for  a  better  morality. 

As  investments,  whether  public  or  private,  increase,  so  must 
come,  as  a  necessary  fellowship  with  them,  protection  from  de- 
structive elements,  and  no  element  can  afford  a  better  protection 
than  the  very  elements  themselves  that  are  in  themselves  destruc- 
tive— "similia  similihus  curantur,"  hackneyed  though  it  is,  is 
nevertheless  true. 

Harnessed,  the  lightning's  bolts  are  the  obedient  servants  of 
man;  the  message  that  summons  the  protection  is  the  bridled  de- 
stroyer. So  we  of  the  profession  electrical  are  in  line  with  the 
progressive  policy  of  to-day,  to  aid  by  our  knowledge  the  minimiz- 
ing of  the  losses,  which  are  but  factors  in  decadence,  and  to  as- 
sist as  far  as  we  can  in  establishing  safeguards  and  helps  to  reduce 
the  criminal  losses  caused  by  fires. 

There  is  perhaps  no  class  in  the  United  States  to-day  doing 
more  toward  fire  prevention,  accident  prevention  and  the  general 
betterment  of  conditions,  than  the  men  engaged  in  the  generation 
and  distribution  of  electric  energy,  all  of  which  is  due  to  the  fact 
that  those  who  come  in  direct  contact  with  the  great  power  known 
as  "electric  energy"  realize  better  than  any  other  class  the  great 
benefits  w^hich  are  being  derived  and  spread  broadcast  through  the 


262       WORLD'S  INSURANCE  CONGRESS 

increasing  use  of  that  energy,  and  also  appreciate  the  great  dangers 
incident  to  its  careless  use. 

While  Califoruians  are  in  close  touch  with  the  general  work 
which  is  being  carried  on  throughout  the  United  States  toward 
the  elemination  of  fires  and  the  avoidance  of  accidents,  we  of 
San  Francisco  are  also  in  a  better  position  to  appreciate  fully 
the  great  work  which  was  accomplished  and  the  assistance  rend- 
ered in  rebuilding  San  Francisco,  through  the  Insurance  Compa- 
nies who  stood  by  and  contributed  the  mone^^  which  was  neces- 
sary to  rebuild  our  City,  and  many  of  whom  stood  their  losses 
nobly  and  honorably. 

The  business  of  electric  g'eneration  and  distribution  to-day 
stands  unique,  owing  to  the  ever  increasing  demand  which  is 
being  made  for  continuous  and  constant  service.  With  particular 
reference  to  the  operations  of  the  larger  companies,  they  have  been 
impressed  with  the  idea  that  as  the  servants  of  the  public  they 
are  not  in  position  to  allow  their  properties  to  be  destroyed  by  fires 
or  accidents  no  matter  how  much  insurance  is  carried,  nor  con- 
sidering the  promptness  with  which  claims  have  been  paid  in  the 
past.  They  have  become  firmly  convinced  that  their  only  salva- 
tion, and  the  only  way  in  which  they  can  serve  the  public  satisfac- 
torily, is  to  work  along  the  lines  of  scientific  fire  and  accident 
prevention.  In  other  words :  Practically  every  city  in  the  world 
is  at  times  dependent  upon  its  central  steam  generating  station  for 
the  power  to  operate  street  railways,  elevators,  factories,  and  to 
supply  the  light  needed  for  the  city.  The  destruction  of  a  central 
steam  station  by  fire,  and  the  payment  to-morrow  of  the  entire 
fire  loss  would  not  to-night  give  a  city  its  lights,  would  not  to- 
morrow operate  its  street  railways,  nor  turn  the  w^heels  in  the 
numerous  factories  that  depend  upon  it.  No  company  can  afford 
to  allow  its  central  power  generating  plant,  or  any  of  its  substa- 
tions and  switching  stations,  to  be  destroyed  by  fire,  and  effective 
and  efficient  service  should  devote  energies  to  do  away  with  the 
possibilities  of  fires  in  stations,  not  only  from  a  monetary  stand- 
point, but  from  the  standpoint  of  few  interruptions  to  service  on 
account  of  fires  and  of  accidents.  Accidents  figure  in  the  interrup- 
tion of  service  as  well  as  fire,  and  must  also  be  guarded  against. 

Corporations  supplying  energy  to  any  municipality  should  lead 
an  example  in  the  prevention  of  fires,  in  the  training  of  men,  in 
the  proper  and  safe  handling  of  the  commodity  which  they  dis- 
tribute, and  should  exercise  not  only  constant  care  to  avoid  acci- 
dents to  employees,  but  zeal  in  educating  the  general  public,  with 
whom  it  comes  in  constant  contact,  to  install  necessary  safety  de- 
vices to  prevent  fires  and  accidents.  In  the  territory  of  35.000 
square  miles,  operated  by  one  public  utility,  there  is  a  population 
of  1,500,000,  and  the  example  is  set  by  over  5,000  employees  in 
doing  missionary  work  and  in  educating  others  to  a  high  standard 
of  officioricy,  and  the  avoidance  of  fires  and  accidents. 

The  engineers  of  all  organizations  are  in  constant  touch — through 


WORLD'S  INSURANCE  CONGRESS  263 

the  American  Institute  of  Electrical  Engineers,  the  American  Gas 
Institute  and  the  National  Electric  Light  Association,  through 
membership  in  the  National  Fire  Protection  Association,  and 
through  committees  appointed  from  time  to  time  from  its  ranks 
to  assist  different  bureaus  and  associations,  such  as  the  Bureau  of 
Standards  of  the  United  States  Government,  in  formulating  the 
latest  ideas  and  sound  principles  laid  down, — and  are  following  the 
scientific  principles  evolved  by  them  in  every  possible  instance. 
They  can  look  back  to  the  old  structures  and  power  houses,  which 
were  the  pioneers  and  were  built  of  inflammable  materials,  in  no 
way  protected  as  to-day  from  accidents  both  to  equipment  and  to 
employees,  and  feel  a  sense  of  gratification  that  they  have  gradually 
and  continuously  built  them  better,  until  to-day  there  are  hun- 
dreds of  structures  that  are  absolutely  fire-proof  throughout,  built 
of  steel,  concrete,  brick  and  stone,  and  with  the  very  latest  equip- 
ment that  science  can  give  us.  In  addition  they  have  followed  to 
the  letter  the  rules  and  regulations  laid  down  in  the  "Safety 
First"  campaign  which  has  of  late  been  sweeping  the  entire 
United  States,  and  feel  that  to-day  they  are  up-to-date  and  have 
accomplished  wonders. 

Regular  inspection  of  all  properties  of  each  company  should  be 
cared  for  by  a  Fire  Insurance  Department;  hose  lines,  chemical 
extinguishers  and  every  known  approved  fire  fighting  appliance 
should  be  installed  in  power  houses  and  buildings  of  all  kinds,  and 
regular  inspections  made  by  Safety  Engineers,  and  bulletins  and 
educational  matter  constantly  sent  out  by  Safety  Committees. 

High-power  automobiles  should  attend  all  fires  and  assist  the 
fire  departments  in  the  elhnination  of  dangerous  electrical  appli- 
ances, w^hether  belonging  to  the  company  or  privately  owned. 

Automobiles  used  for  general  purposes,  and  automobiles  and 
wagons  known  as  "trouble  wagons,"  should  be  equipped  with 
chemical  extinguishers,  and  many  instances  are  of  record  where 
men  have  used  these  extinguishers  on  wagons  so  equipped  to  good 
advantage  in  overcoming  fires  in  private  properties  when  they  hap- 
pened to  be  in  the  vicinity. 

Men  should  be  made  familiar  with  city  ordinances  and  all 
the  rules  and  regulations  laid  down  by  the  city  governments 
wherein  they  operate,  and  should  religiously  adhere  to  and  follow 
such  rules  and  regulations. 

The  electric  business,  in  which  we  are,  of  course,  primarily  inter- 
ested, carries  with  it,  so  far  as  accidents  and  fires  are  concerned, 
perhaps  a  larger  assortment  of  hazardous  conditions  than  any  other 
known  manufacturing  business.  It  is  subject  to  all  of  the  ordinary 
risks  that  any  building,  dwelling  house  or  factory  is  subject  to, 
and  in  addition  is  also  subjected  to  conditions  which  it  is  almost 
impossible  for  human  beings  to  guard  against.  The  breaking  down 
of  a  transformer,  with  a  resultant  fire  from  the  oil  in  the  trans- 
former, the  breaking  down  of  switches  and  switch  cells,  the  break- 
ing down  and  burning  out  of  motors  and  electric  generators,  are 


264       WORLD'S  INSURANCE  CONGRESS 

not  at  all  times  due  to  local  conditions,  but  may  be  due  to  some 
trouble  on  lines,  or  in  some  power  house  or  station  miles  away, 
and  these  break-downs  are  so  instantaneous,  and  in  many  cases  so 
severe,  that  it  is  only  by  the  most  rapid  and  intelligent  work  and 
action  on  the  part  of  operators  in  these  stations  that  disaster  is 
avoided.  Switches  have  to  be  thrown,  the  lines  cleared,  the  trouble 
located,  the  condition  of  the  trouble  analyzed,  and  in  many  cases 
in  large  generating  stations,  where  there  are  a  number  of  genera- 
tors and  a  heavy  power  load,  it  cannot,  as  in  an  ordinary  manu- 
facturing plant,  immediately  suspend  all  operations  and  close  doMoi 
the  entire  plant  and  confine  its  endeavors  to  overcoming  the  trouble 
in  one  piece  of  apparatus.  The  trouble  in  the  power  house  must 
be  isolated,  while  the  machines  not  affected  must  be  operated,  and 
simultaneously  the  trouble  in  the  macliine  affected  must  be  over- 
come, and  if  a  fire  occurs  at  the  same  time,  the  fire  must  be  fought. 
Fires  in  electrical  apparatus  may  be  primarily  considered  as  acci- 
dents, owing  to  the  fact  that  they  ordinarily  occur  due  to  a  heavy 
surge  coming  back  on  the  lines  entering  power  stations.  This  over- 
loads the  apparatus  and  causes  what  is  called  a  "break-down  ;"  and 
then  the  fires  which  may  result  are  a  secondarj^  cause  due  to  the 
accident  in  the  first  place. 

The  fighting  of  a  fire  in  an  electric  station  is  a  very  serious 
matter,  and  the  utmost  care  and  intelligence  must  be  used  in  con- 
nection with  overcoming  such  fires ;  and  especialty  does  this  obtain 
when,  as  before  stated,  we  cannot  discontinue  operations  in  such 
power  houses,  and  devote  all  of  our  energies  to  overcoming  the 
fire. 

In  the  ordinary  manufacturing  plant,  hose  lines  can  be  used 
indiscriminately,  chemical  fire  extinguishers,  water  buckets,  the 
Fire  Department,  and  every  known  assistance  can  be  at  once 
utilized,  and  the  one  object  in  view  is  to  put  out  the  fire.  In  a 
power  house,  a  hose  line  is  the  last  resort.  Water  cannot  indis- 
criminately be  turned  into  highly  charged  electrical  apparatus,  as 
this  might  cause  further  trouble  by  short  circuiting,  and  might 
cause  injury  to  the  employees  in  such  plant,  and  might  injure 
electrical  apparatus,  by  short  circuiting,  which  was  primarily  not 
affected  at  all  by  the  break-down  or  the  fire.  i\Ien  have  to  be 
trained  to  consider  all  of  the  elements  incidental  to  such  a  fire' 
and  select  and  quickly  use  the  apparatus  which  is  best  suited  to 
overcome  the  fire,  and  at  the  same  time  not  injure  the  other  ma- 
chinery in  the  plants. 

Rules  of  companies  are  made  along  the  lines  of  educating  men, 
in  cases  of  electrical  fires,  to  use  dry  powder  extinguishers,  sand, 
sawdust,  and  extinguishers  which  are  considered  non-conductors, 
in  overcoming  such  fires  if  possible.  If  these  appliances  are  not 
adequate,  and  the  fire  is  considered  of  too  great  magnitude  to 
be  overcome  in  this  way,  chemical  or  wet  fire  extinguishers  are 
then  resorted  to.     As  a  last  resort,  and  where  the  buildings  may 


WORLD'S  INSURANCE  CONGRESS  265 

become  aflame,  it  is  permissible  to  use  hose  lines,  shut  down  the 
plant,  and  fight  the  fire  as  an  ordinary  factory  fire. 

One  of  the  large  electrical  operating  companies  has  published 
for  the  benefit  of  its  employees  instructions  concerning  conduct  at 
fires,  from  which  the  following  excerpts  are  made : 

"Safety  First — Fires  Last 

"A  Few  Suggestions  Whose  General  Adoption 
Seems  Worth  While 

' '  In  the  event  of  fire  in  any  large  plant  the  man  in  charge  should 
constitute  himself  a  fire  chief,  and  avoid  confusion  and  loss  of 
time  by  devoting  his  entire  attention  to  directing  his  men. 

"The  city  fire  department,  where  available,  should  be  called 
immediately  a  fire  is  discovered,  irrespective  of  the  magnitude  of 
the  fire. 

"All  men  in  plants  should  familiarize  themselves  with  the  loca- 
tion of  fire  apparatus,  and  keep  in  mind  a  plan  of  action  in  case 
of  fire. 

"When  a  generator,  motor,  or  other  electrical  apparatus  takes 
fire,  cut  off  the  current  from  such  apparatus,  shut  down  all  revolv- 
ing machinery,  and  apply  Pj^rene,  chemical  and  powder  extinguish- 
ers, and  water  from  hose  lines,  in  the  order  named.  If  current 
cannot  be  cut  off,  use  Pyrene  first,  or  get  on  a  safety  stand  and 
use  the  chemicals  and  hose  lines. 

"If  a  building  is  on  fire,  the  first  move  should  be  directed  to- 
ward cutting  all  electricity  from  the  plant,  whether  electric  station, 
gas  works,  warehouse  or  any  other  class  of  building,  and  then 
handle  the  fire  as  in  ordinary  cases. 

' '  Fires  in  cable-ways  in  stations  should  be  overcome  with  Pyrene 
and  powder  extinguishers,  or  smothered  with  sawdust  and  sand. 
If  the  fire  communicates  to  the  building,  cut  the  station  out  and 
apply  water. 

"Oil  and  gasoline  fires  should  be  attacked  with  Pyrene,  chemical 
and  powder  extinguishers,  or  smothered  with  sawdust  and  sand. 
Attack  all  such  fires  from  the  windward  side,  if  possible.  Direct 
streams  from  Pyrene  and  chemical  (wet)  extinguishers  toward 
one  edge  of  the  fire  and  continue  crowding  the  fire  until  overcome. 
Streams  thrown  into  the  center  of  such  fires  may  scatter  the  fire. 

^'Automohile  Fires. — Use  Pyrene,  chemical  and  powder  extin- 
guishers, sawdust  and  sand,  in  order  named.  Robes,  blankets  and 
tarpaulins  can  also  be  used  to  good  advantage  in  smothering  such 
fires. 

"Pyrene,  chemical  (wet)  and  powder  extinguishers  should  be 
used  as  a  battery,  when  possible.  The  loss  of  a  few  seconds  in 
getting  several  on  a  fire  at  one  time  will  be  made  up  in  effective- 
ness, quantity  being  a  valuable  consideration. 

"Pyrene  extinguishers  should  be  directed  into  the  flames.  They 
can  be  used  safely  in  breaking  an  arc ;  the  fluid  is  a  non-conductor, 
and  harmless  to  any  class  of  apparatus. 

"Chemical  (wet)  extinguishers  should  be  directed  to  the  base 
of  the  fire  or  flames,  and  can  be  used  without  harmful  effect  on 
any  apparatus. 


266  WORLD'S  INSURANCE  CONGRESS 

"Pyrene  and  chemical  extinguisher  fluids,  as  discharged  from 
the  retainers,  are  absolutely  harmless  to  persons,  clothing  or  other 
material. 

"Don't  start  fighting  a  fire  haphazard.  A  few  seconds  expended 
in  cool  and  deliberate  planning  will  result  in  an  intelligent  and 
sane  fight. 

"Don't  put  water  on  an  oil  or  gasoline  fire.  Water  will  spread 
the  fire. 

"Don't  hesitate  about  turning  a  Pyrene  or  chemical  (wet)  ex- 
tinguisher on  a  man  if  his  clothing  is  afire.     It  will  not  harm  him. 

"Don't  hesitate  about  using  fire  apparatus.  It  is  provided  for 
use,  and  the  cost  of  recharges  is  insignificant  when  compared  with 
damage  that  may  result  if  a  fire  gets  beyond  control. 

"Don't  hesitate  about  wetting  electrical  machinery,  if  the  fire 
is  of  such  magnitude  that  it  cannot  be  overcome  with  Pyrene, 
powder  extinguishers,  sawdust  or  sand.  A  wet  generator  is  better 
than  a  burned  station. 

"Don't  get  excited.  Numerous  cases  are  on  record  where  glass- 
ware has  been  thrown  out  of  windows  onto  concrete  pavements, 
while  human  beings  have  been  left  in  burning  buildings. 

"Don't  forget  that  a  fire  may  throw  many  men  out  of  employ- 
ment. 

"Don't  forget  that  rubbish  and  fire  are  team-mates." 

When  we  consider  that  a  city  such  as  San  Francisco,  with  a 
population  of  about  one-half  million,  from  figures  issued  by  the' 
National  Fire  Protection  Association,  has  an  annual  normal  fire 
loss  of  about  $1,000,000,  and  that  a  tax  is  levied  against  each  of 
the  inhabitants  of  this  city  of  about  $3.60  per  annum  for  main- 
taining a  Fire  Department,  and  that  in  spite  of  the  enormous  ex- 
pense there  is  still  an  additional  per  capita  loss  of  $2.38  per  an- 
num, we  feel  that  it  behooves  every  one  of  us  to  study  carefully 
this  great  problem  which  confronts  the  American  public,  and  which 
has  been  so  aptly  christened  "The  Crime  of  Carelessness."  based 
upon  the  fact  that  75  per  cent,  of  all  fires  are  considered  due  to 
carelessness. 

When  we  compare  the  total  per  capita  loss  by  fires  in  the 
United  States  each  year  of  about  $2.50  against  the  losses  as  re- 
ported from  Europe — Germany  20  cents  per  capita,  France  84 
cents  per  capita,  England  54  cents  per  capita,  we  realize,  in  spite 
of  the  enormous  resources  and  wealth  of  this  great  nation,  that 
we  are  day  in  and  day  out  wasting  and  expending  our  energies 
through  allowing  to  be  destroyed  that  which  we  have  worked  to 
build,  and  which  can  be  considered  as  lost  forever. 

While  a  complete  and  thorough  study  of  fire  protection  has  not 
been  permitted  to  us,  owing  to  our  other  numerous  duties,  as  it 
has  been  permitted  to  the  thousands  of  clever  men  who  are  to-day 
giving  their  entire  time  and  attention  to  this  serious  subject,  we  do 
believe  that  the  time  is  approaching,  and  rapidly,  when  the  destruc- 
tion of  properties  by  fires,  and  especially  when  these  fires  can  be 
attributed  to  carelessness,  should  and  must  be  considered  in  the 


WORLD'S  INSURANCE  CONGRESS  267 

same  category  as  any  other  criminal  act.  And  we  heartily  agree 
that  a  law  should  be  provided  making  it  a  crime  subject  to  fines, 
and  in  extreme  cases  a  felony,  when,  through  carelessness  and  after 
property  owners  have  been  warned,  they  allow  their  own  prop- 
erties to  be  carelessly  destroyed,  and  incidentally  destroy  properties 
belonging  to  others,  and  cause  not  only  a  monetary  loss  but  the 
destruction  of  life. 

We  understand  that  laws  are  now  being  enacted  and  proposed 
in  other  States  of  this  Union  along  these  lines;  and  we  believe 
that  the  great  American  public,  when  thoroughly  posted  and  edu- 
cated up  to  the  fact  that  a  number  of  fires  that  occur  daily  are 
avoidable,  will  heartily  endorse  such  rules  and  regulations,  and 
see  that  they  are  maintained  and  enforced. 

There  is  another  side  to  insurance.  It  is  that  involving  protec- 
tion to  the  health  and  life  of  humanity,  and  it  comes  to  us  as  a 
method  of  preventing  loss  of  income  in  sickness  and  accident  and 
in  the  other  mishaps  and  vicissitudes  of  daily  life. 

Preventing  losses  in  sickness  and  in  accidents,  and  even  in  death 
itself,  which  was  preventing  results,  not  causes,  naturally  led  to 
the  prevention  of  those  things  that  produced  the  results.  So,  in 
time,  we  find  insurance  directing  its  best  efforts  towards  the  pre- 
vention of  sickness,  towards  the  prevention  of  accidents,  casualties 
and  all  the  other  events  which  may  be  insured  against.  We  find 
the  prevention  of  sickness,  and  oftentimes  of  death,  provided  for 
by  medical  instruction  and  expert  medical  service,  and  the  pre- 
vention of  accidents  and  casualties  by  the  application  of  mechani- 
cal skill  and  the  education  of  the  social  and  industrial  world.  In 
a  word,  insurance  "prevention"  has  come  to  mean  teaching  the 
world  how  to  live  better  and  safer. 

It  may  be  true  that  such  prevention  grew  out  of  an  effort  to 
reduce  costs,  but  at  that  the  end  obtained  is  to  our  social  advan- 
tage. Like  many  other  things  beneficial  to  humanity,  it  is  the 
end  that  counts,  not  the  purpose  or  the  means.  Necessity  may 
have  brought  the  result,  financial  necessity  or  economic  necessity, 
but  that  does  not  matter;  the  result  is  wholly  beneficial,  wholly 
to  the  public  good. 

Accident  prevention  has  probably  come  closer  home  to  the  elec- 
trical industries  than  any  of  the  other  things  which  may  be  called 
the  preventive  results  of  insurance.  It  has  pressed  close  upon 
these  industries  because  they  are  extra-hazardous  and  produce  a 
high  quota  of  accidents  and  injuries.  And  having  frequent  acci- 
dents, the  electrical  industries  have  been  quick  to  see  the  burden 
and  cost  of  accidents,  and  having  foresight,  they  have  seen  the 
thing  from  both  the  workman's  point  of  view,  and  the  employer's 
point  of  view. 

From  the  workman's  side  they  have  seen  the  suffering  he  has 
had  to  sustain,  the  loss  of  earnings  he  has  had  to  bear,  affecting 
his  own  well-being  and  the  well-being  of  his  family  and  depend- 


268       WORLD'S  INSURANCE  CONGRESS 

ents,  and  affecting  the  community  by  creating  delinquency  and 
poverty. 

From  the  employer's  side  they  have  learned  the  cost  of  medical 
expense  and  the  cost  of  compensation  and  damages,  also  the  cost  of 
losing  the  service  of  experienced  and  trained  workmen. 

Now,  the  men  in  the  electric  industries  are  farsighted  and  have 
industrial  vision.  They  work  in  a  trade  that  is  ever  changing  in 
a  physical  way,  working  changes  and  improvements  that  stimulate 
and  require  imagination.  Moreover,  the  communities  they  serve, 
the  great  centers  of  population,  are  ever  a  seething  mass  of  eco- 
nomic shifts  and  changes,  calling  for  vision  and  foresight  from 
those  who  would  keep  pace  with  them.  These  changes,  mechanical, 
social  and  economic,  in  the  nature  of  things,  make  for  progress. 
They  carry  with  them  the  men  with  whom  they  come  in  contact. 
Yet  it  is  safe  to  say  that  in  the  one  thing  of  accident  prevention 
the  electric  industries  have  had  to  follow  rather  than  lead.  They 
have  had  to  go  beyond  themselves;  they  have  had  to  draw  upon 
insurance,  finding  insurance  first  in  practical  prevention,  first  in 
devising  and  installing  safeguards  and  first  in  studying  and  analyz- 
ing the  causes  of  accidents. 

It  was  insurance  research,  too,  that  seems  to  have  first  brought 
to  mind  the  economic  burdens  of  accidents  and  to  have  made  us 
see  that  accident  prevention  is  one  of  the  great  social  duties;  it 
was  that  research  that  made  us  see  in  industrial  accidents  one  of 
the  great  causes  of  poverty.  And  if  we  have  come  to  see  that 
preventing  accidents  reduces  dependency  and  delinquency  and 
poverty  and  thereby  makes  for  a  better  citizenship,  it  is  because 
we  have  been  educated  up  to  that,  because  we  have  been  brought 
into  the  light  by  others  than  ourselves. 


OPENING  ADDRESS  OF  THE  SPECIAL  CHAIRMAN 

]\I.    H.   DeYoung 

Proprietor  and  Publisher,   San  Francisco   Chronicle;  Vice-Presi- 
dent, Panama-Pacific  International  Exposition 

Mr.  Chairman  and  Gentlemen:  After  listening  to  the  remarks 
of  your  Permanent  Chairman,  if  I  could  blush,  I  would.  I  thank 
him  very  much  indeed  for  the  compliments  he  has  just  paid  me. 
In  looking  over  this  organization,  as  I  sat  here,  I  thought  of  how 
and  where  it  was  created,  or  the  foundation  of  the  business  in 
which  you  are  making  your  living.  I  looked  back  and  saw  .fust 
where  it  began.    It  was  created  in  a  public  coffee-house. 

Insurance  started  in  a  coffee-house  on  Tower  Street,  in  London, 
run  by  a  man  named  Lloyd,  and  there  men  interested  in  ships, 
ship  owners  and  shipping  men,  met  daily,  and  in  the  course  of 
their  conversation  decided  to  insure  among  themselves  the  risks  of 


WORLD'S  INSURANCE  CONGRESS  269 

their  business  by  dividing  the  responsibility.  This  went  on  for  a 
year  or  two  until  this  publican,  this  man  Lloyd,  decided  tliat  he 
would  move  down  to  Lombard  Street,  near  the  center  of  the  com- 
mercial life,  the  financial  life  and  shipping  life  in  London,  and 
in  a  larger  place  and  see  if  he  could  not  build  up  this  business. 

In  this  new  location  Lloyd  gathered  around  him,  as  in  his  former 
public-house,  the  shipping  men  of  the  whole  of  London.  He  then 
issued  a  weekly  newspaper,  called  Lloyd's  News,  the  oldest  paper, 
but  one,  in  the  history  of  England,  and  that  paper  is  published 
to-day.  It  is  called  Lloyd's  List.  There  in  that  saloon  daily 
these  men  met  and  prepared  means  to  mutually  insure  one  another, 
until  it  became  a  feature  of  the  business  life  of  London.  This 
was  in  1692. 

Queen  Bess  and  her  Ministry,  when  applied  to,  determined  to 
legalize  this  body  of  men  by  legislation,  and  when  Sir  Nicholas 
Bacon  appeared  before  Parliament  he  stated  that  "it  is  a  wise 
merchant  who  is  willing  to  give  up  a  part  of  his  own  goods  for 
the  protection  and  assurance  of  the  rest."  He  succeeded  in 
passing  through  Parliament  an  act  legalizing  these  men  that  met 
at  Lloyd 's.  Their  action  and  their  so-called  organization  was  called 
Lloyd's.  Why,  nobody  knows.  Perhaps  because  they  met  at 
Lloyd 's. 

After  the  passage  of  this  act  of  Parliament  they  moved  to  the 
Royal  Exchange,  and  as  they  grew  and  developed  in  the  business, 
Parliament  passed  another  act  ordering  the  shipping  men  to  fur- 
nish to  Lloyd's  agents  throughout  the  world  data,  or  information, 
of  passing  ships,  their  cargoes  and  such  information,  and  so  Lloyd 's 
began  to  grow  and  develop.  They  are  still  in  the  Royal  Exchange. 
It  is  run  just  the  same  as  it  was  100  or  200  years  ago. 

When  I  was  in  London  I  went  to  Lloyd's  to  see  how  they  did 
things.  They  have  three  classes  of  members:  The  subscribing 
member  that  pays  $50  a  year,  who  has  the  privilege  of  the  head- 
quarters of  Lloyd's  but  has  no  vote  and  nothing  to  do  with  the 
management  of  this  great  organization.  Then  they  have  the  under- 
writing members  who  run  the  organization.  They  are  the  members 
that  pay  $500  per  year  for  their  membership. 

The  underwriting  members  are  the  men  who  take  the  risks  of 
insurance.  They  are  compelled  to  deposit  with  the  organization 
the  sum  of  $25,000  minimum,  or  $50,000  maximum,  which  money 
is  held  as  long  as  the  underwriting  member  has  any  risks  unset- 
tled. This  deposit  of  the  underwriting  members  is  used  as  a  guar- 
anty for  the  payment  of  any  losses  for  which  they  are  responsible. 

The  firm  of  Lloyd's  is  not  a  corporation,  and  has  no  capital.  It 
has  an  enormous  capital  from  the  underwriters  who  make  these 
deposits,  kept  there  to  make  good  on  their  underwriting. 

I  went  around  that  room  and  was  astonished  at  the  primitive 
manner  in  which  they  do  business.  They  have  a  bulletin  board  all 
around  the  room,  and  they  have  a  blank  form,  and  anybody  who 
wants  insurance  fills  in  that  form,  stating  the  name  of  the  ship. 


270       WORLD'S  INSURANCE  CONGRESS 

its  owner,  its  class  in  Lloyd's,  "A-1,"  "A-2"  or  whatever  class 
it  may  be,  and  the  amount  of  insurance  they  want.  Now  these 
underwriting  membei*s  do  not  place  their  own  insurance.  They 
employ  brokers  and  some  of  these  brokers  will  have  two  or  three 
clients. 

These  brokers  make  their  way  around  the  room,  which  is  nearly 
as  large  as  this.  They  pick  up  a  slip,  look  it  over,  study  it,  take 
out  a  pen  and  write  the  name  of  one  of  their  client  in  the  amount 
the  broker  thinks  his  client  desires  to  underwrite,  say,  "Brown, 
$500  or  $2500,"  "John  Smith,  $1000  or  $5000,"  and  the  writing 
in  of  that  name  makes  those  men  responsible  for  that  amount  on 
that  risk.  These  brokers  are  employed  by  the  underwriters  at  a 
salary  and  percentage  of  the  profits  which  an  underwriter  makes 
through  the  care  and  good  judgment  of  their  broker  annually. 
And  that  is  the  way  insurance  was  made  in  Lloyd 's  100  years  ago, 
that  is  the  way  they  do  it  to-day.  What  was  good  enough  for 
their  grandfathers  is  good  enough  for  them.  In  England  they  do 
not  believe  in  changing  things. 

Then  the  exchange  employs  experts,  who  represent  Lloyd's,  to 
write  the  history  of  every  ship,  when  it  was  built,  how  it  was 
built,  whether  it  is  a  good  ship ;  then  they  rate  them  as  ' '  Lloyd 's 
A-1,"  "A-2"  and  so  on,  and  that  rating  of  the  representatives  of 
the  underwriters  gives  the  broker  the  cue  whether  or  not  to  cover 
the  risk. 

Of  later  years  you  read  of  Lloyd's  covering  other  risks  outside 
of  their  regular  business.  That  is  done  the  same  way.  They  bet 
against  the  weather,  bet  against  the  war,  and  those  that  want  to 
take  that  sort  of  risks  have  an  opportunity  of  doing  so. 

So  you  see.  Gentlemen,  the  foundation  of  your  great  business 
was  started  in  a  coffee-house  on  lines  created  in  a  coffee-house; 
and  they  have  not  been  changed  from  that  day  to  this. 

It  is  a  strange  thing  that  another  branch  of  your  business 
emanated  from  the  coffee-house — life  insurance.  It  started  right 
there.  The  nature  of  the  shipping  business  200  years  ago  created 
a  great  risk — the  risk  of  the  sea  pirates,  the  Moorish  pirates,  the 
Turkish  pirates  and  many  others  of  this  character. 

Many  owners  of  these  cargoes  would  go  to  sea  with  them  to 
attend  to  the  selling  of  the  cargo.  They  knew  it  was  a  great  risk 
to  travel,  for  they  took  the  risk  of  losing  their  lives,  or  being  held 
by  the  pirates  for  ransom.  These  men  secured  an  undertaking 
guaranteeing  to  pay  their  ransom  in  ease  they  were  held  by  pirates. 
If  they  lost  their  lives  the  same  amount  was  provided  for  the 
widow.     So  you  see  life  insurance  started  from  marine  insurance. 

Another  important  branch  of  your  business — fire  insurance — was 
started  much  on  the  same  principle.  It  began  in  London  when 
200  or  1000  householders  created  an  insurance  fund  and  insured 
one  another.  They  formed  an  organization  in  which  each  paid  so 
much  down  and  each  agreed  to  pay  as  much  more  in  case  of  fire. 


WORLD'S  INSURANCE  CONGRESS  271 

So  fire  insurance  started  in  the  same  way  as  marine  and  life 
insurance. 

The  first  life  insurance  company  was  the  Society  for  Widows 
and  Orphans.  They  secured  the  privilege  to  be  a  corporation  from 
Parliament,  but  people  did  not  look  with  favor  upon  it. 

Insurance — the  word  now  covers  nearly  every  kind  of  corpora- 
tion, the  growth,  the  development  of  it,  like  a  mushroom,  growing 
and  growing  and  developing  till  now  you  could  not  half  of  you 
tell  how  many  different  kinds  there  are.  We  have  marine  insur- 
ance, life  insurance,  we  have  fire  insurance,  we  have  indemnity 
insurance,  elevator  insurance,  steam  boiler  insurance,  automobile 
and  burglar  insurance,  and  we  have  insurance  for  our  rents!  In 
fact,  I  do  not  know  of  all  the  insurance  companies  that  have  or- 
ganized in  this  country,  but  I  think  if  we  could  insure  the  honesty 
of  our  politicians  that  that  would  be  a  great  insurance. 

' '  Insurance ' '  and  ' '  assurance ' '  are  two  words  used  in  that  coun- 
try, but  "assurance"  was  the  title  that  this  coffee  merchant's 
customers  gave  when  they  insured  a  life.  It  was  an  "assurance," 
not  "insurance."  There  are  still  great  companies  in  England 
called  "life  assurance  companies." 

Insurance  has  different  kinds  of  risks,  but  the  one  that  takes 
the  great  risk  and  meets  with  the  greatest  losses  at  one  time  is 
fire  insurance.  Life  insurance,  of  course,  has  its  many  risks,  as 
in  the  event  of  a  great  epidemic,  brought  on  by  any  violent  dis- 
eases; but  fire  insurance  carries  the  most  dangerous  risk  and  has 
tested  the  financial  corporations  of  this  country  as  well  as  the 
world.  We  have  had  the  test  in  this  country.  We  have  had  our 
Boston  fire,  our  Baltimore  fire,  our  Chicago  fire,  and  on  top  of  them 
all  with  great  pride  we  swell  out  and  say  San  Francisco  had  the 
greatest  fire  of  them  all.  We  all  like  to  boast,  and  we  say  we  are 
proud  that  we  had  the  greatest  fire,  and.  Gentlemen,  that  fire  dem- 
onstrated the  financial  standing  of  many  insurance  companies. 
There  never  was  such  a  loss,  which  involved  all  the  great  corpo- 
rations in  that  business-,  as  the  San  Francisco  fire.  There  never 
was  such  a  result  or  burden  as  that  brought  about  by  the  San 
Francisco  fire. 

The  insurance  companies  met  their  great  losses  in  San  Francisco ; 
the  exceptions  were  few.  These  companies  paid  out  $220,000,000 
in  losses,  and  the  great  majority  are  still  alive  and  still  doing  busi- 
ness. The  loss  did  not  wipe  out  any  of  our  great  American  com- 
panies. When  Chicago  burned  up,  it  burned  up  its  insurance  com- 
panies. They  got  frightened  and  went  out  of  business.  They  paid 
10  or  15  cents  on  the  dollar.  When  San  Francisco  burned  it  did 
not  burn  up  one  of  our  San  Francisco  insurance  companies.  They 
paid  their  bills. 

One  company  alone  paid  $11,000,000.  It  settled  all  its  losses, 
and  there  never  was  a  disagreement  between  the  company  and  the 
policyholders.  There  is  not  a  policyholder  that  had  business  with 
them  and  met  a  loss  that  is  not  still  a  patron  of  that  company. 


272  WORLD'S  INSURANCE  CONGRESS 

We  had  oue  compauy  which  assessed  its  stockholders  four  times 
its  capital.  The  stockholders  met  their  own  private  losses  as  well 
as  those  of  their  company.  They  paid  up  the  assessment,  and  every 
dollar  of  its  losses  has  been  paid  in  full. 

There,  I  say,  that  is  insurance ;  and  we  of  San  Francisco  are 
proud  of  the  insurance  companies  of  the  world.  We  had  a  few 
here  that  did  not  meet  their  losses,  but  they  were  not  American 
companies.     They  were  foreign  companies. 

You  have  heard  during  the  last  few  days  many  able  speakers 
upon  the  purposes  of  this  congress;  why  the  Panama-Pacific  In- 
ternational Exposition  has  given  such  prominence  to  insurance; 
the  broad  service  that  insurance  has  performed;  its  constructive 
influence;  the  parts  that  the  great  National  associations  play  in 
carrying  out  its  service ;  and  its  broadening  influence  in  social 
economy. 

In  fact,  a  great  educational  banquet  has  been  served  you,  but 
to-day  you  get  down  to  the  real  purpose  for  which  you  insurance 
men  have  come  to  San  Francisco. 

You  have  gradually  educated  one  another  and  the  public  as 
to  the  great  service  which  insurance  is  performing  for  society, 
and  held  forth  alluring  although  none  the  less  truthful  statements 
as  to  the  extent  that  this  service  can  be  broadened  so  as  finally  to 
envelop  and  uplift  the  entire  society  of  the  Nation  and  the  world ; 
but  to-day,  I  take  it,  from  a  close  study  of  your  programme,  you 
are  going  to  discuss  the  real  problems  that  brought  you  here. 

You  are  evidently  going  to  exploit  some  of  your  troubles,  and 
doubtless  ways  to  remedy  them,  and  if  I  read  your  programme 
correctly  (and  I  have  studied  it  a  great  deal)  the  entire  proceed- 
ings of  the  last  four  days  have  been,  as  the  legal  fraternity  would 
say,  the  ground-work  of  your  case.  To-day  you  present  the  case, 
and  if  you  present  it  as  ably  as  the  educational  features  of  the 
days  that  have  preceded  this  have  been  presented,  you  will  no 
doubt  solve  many  of  the  problems,  and  convince  the  public  of  your 
conclusions;  for  I  take  it  that  you  gentlemen  are  here  with  a 
deep,  earnest  purpose,  and  that  that  purpose  really  reaches  its 
climax  in  this  day's  proceedings. 

The  outcome  of  this  meeting  in  San  Francisco  is  the  greatest 
in  the  history  of  insurance.  We  have  here  the  unusual  number 
of  115  National  insurance  organizations,  among  these  organizations 
the  Association  of  Life  Insurance  Presidents,  representing  thirty- 
one  of  the  largest  associations  in  the  United  States;  the  American 
Life  Convention,  representing  one  hundred  smaller  companies; 
the  National  Insurance  Congress  of  America,  representing  nine 
million  members  in  the  United  States;  National  Association  of  Mu- 
tual Assurance  Companies,  representing  seven  million  members  of 
farm  mutual;  the  National  Council  of  Insurance  Federations,  rep- 
resenting the  insurance  federations  of  twelve  States  taking  in  every 
branch  of  insurance  business  and  policyholders. 

The  Panama-Pacific  International  Exposition  is  proud  to  have 


WORLD'S  INSURANCE  CONGRESS  273 

been  the  means  of  fostering  and  bringing  together  this  insurance 
gathering  of  the  great  financial  interests  of  our  country,  engaged 
in  insurance.  The  outcome  of  this,  I  understand,  is  to  be  a  Na- 
tional Union,  a  body  for  the  organization  of  insurance  throughout 
this  country,  representing  every  form  of  insurance  in  this  national 
organization  called  a  National  Union.  The  object  of  this  union, 
as  I  understand  it,  is  to  foster  and  advertise  and  keep  the  people 
advised  of  insurance  matters  generally,  and  to  keep  the  people 
posted  about  insurance  companies  and  insurance  risks  and  interests. 
I  thank  you  very  much.  Gentlemen,  for  listening  to  me,  and  on 
behalf  of  the  Exposition  I  thank  you  for  coming  to  San  Francisco, 
and  I  hope  you  have  enjoyed  our  Exposition.  I  will  now  proceed 
with  the  programme  of  the  day. 


THE    RELATION    OF    FIRE    INSURANCE    TO    THE 
EXPOSITION 

By  William  Sexton 
Former  General  Adjuster,  Fireman's  Fund  Insurance  Company 

Mr.  Chairman,  Ladies  and  Gentlemen:  The  broad  grasp  of  the 
Chairman,  Mr.  De  Young,  on  the  subject  of  insurance  is  only 
equaled  by  his  broad  grasp  of  every  subject  that  comes  up  in  the 
community.  He  has  a  peculiar  faculty  of  absorbing  the  best  end 
of  every  proposition,  and  his  exposition  of  insurance  fills  in  a  gap, 
and  fills  it  better  than  I  could  have  filled  it — than  I  probably 
should  have  filled  it.  But  I  was  called  on  Thursday  at  four  o  'clock 
to  say  something  this  morning,  particularly  on  the  relation  of  fire 
insurance  to  the  Exposition,  and  was  also  told  to  write  a  paper 
not  to  exceed  ten  minutes,  so  I  will  not  take  up  any  more  time  in 
talking,  and  will  commence  the  paper. 

I  am  flattered  by  being  permitted  to  lay  before  the  greatest 
Insurance  Congress  known  in  the  history  of  insurance  the  fact 
that,  because  of  the  $185,000,000  paid  by  the  fire  insurance  com- 
panies of  the  world  for  the  earthquake  fire  losses,  and  the  $250,- 
000,000  in  policies  as  collateral  security  furnished  by  them  for 
loans  on  buildings  and  in  securing  credits  for  materials  and  mer- 
chandise, San  Francisco  was  enabled  to  arise  "Phoenix-like  from 
its  ashes"  and  to  excel  any  other  city  of  its  size  with  better  build- 
ings, with  larger  and  finer  mercantile  establishments,  with  bigger 
banks,  with  greater  per  capita  bank  deposits,  with  larger  news- 
papers, with  better  news  service  and  with  better  fire  protection  and 
fire  departments,  and  its  last  and  its  greatest  achievement,  the 
promotion  of  the  Panama-Pacific  International  Exposition. 

When  the  earthquake  of  April  18,  1906,  quit  quaking  at  5.12 
a.m.,  fires  started  in  various  parts  of  the  city;  the  damage  by  the 
earthquake  and  the  succeeding  fire  was  reported  by  the  sub-com- 


274       WORLD'S  INSURANCE  CONGRESS 

mittee,  Edwin  Duryea,  Jr.,  James  W.  Reid,  Wm.  Cuiiett,  Virgil  G. 
Bogue,  Maj.  C.  M.  McKinstry  and  Marsden  Manson,  as:  "Water 
Main  Breaks  Over  300;"  "All  City  Supply  Mains  Ruptured;" 
"2,932  Acres  Burned  Over;"  "28,188  Buildings  Burned;"  "674 
Lives  Lost." 

The  burned  area  was  double  the  combined  area  of  the  great 
London,    Chicago,   Boston    and   Baltimore   fires. 

At  the  end  of  three  days'  fire  fighting  with  one  night's  rest, 
the  men,  the  descendants  of  the  men  and  the  sviccessors  of  the 
men'  who  fought  Indians  on  the  desert  plains,  who  poled  dugout 
canoes,  fought  tropical  diseases  and  poisonous  reptiles  on  the 
Chagres  and  Nicaragua  rivers,  and  who  fought  the  snow-storms, 
mountain  waves  and  wind  gales  of  Cape  Horn — 

"Where  sailors'  eyes  could  see  a  shroud 
Hung  in  the  folds  of  every  cloud — " 

]\Ien,  spelled  with  a  big  "]\I, "  who  knew  no  such  word  as  fail,  put 
their  shoulders  to  the  wheel  and  with  the  aid  of  their  fire  insurance 
built  the  magnificent  San  Francisco  of  to-day. 

These  big  "M"  men  in  April,  1910,  planned  the  Panama-Pacific 
International  Exposition,  subscribed  personally  $7,500,000,  ar- 
ranged for  $5,000,000  from  the  City  of  San  Francisco,  $5,000,000 
from  the  State  of  California  and  $2,500,000  from  the  counties  of 
California,  starting  the  work  with  a  fund  of  $20,000,000. 

This  $20,000,000,  handled  by  a  Board  of  Directors  and  officers 
selected  on  the  merits  of  financial  standing,  business  ability,  wide 
range  of  experience,  liberal  ideas  and  unquestionable  reliability, 
created  the  greatest,  the  broadest  in  scope,  the  most  artistic  in 
design  and  setting,  the  most  elegant  in  architecture,  the  most  eco- 
nomical in  construction  and  the  most  convenient  in  operation  of 
any  World's  Exposition,  this  beautiful,  useful  and  lasting  Audi- 
torium for  San  Francisco. 

The  visitor  to  the  Fair  can  see  more  and  learn  more  of  the 
people  of  the  nations  of  the  earth  and  more  of  the  products  of 
land  and  sea,  farm  and  factory,  for  a  ten-dollar  season  ticket, 
than  in  ten  years'  travel  at  an  expense  of  $25,000. 

The  Fair  is  a  wonder;  the  men  who  planned  it  and  carried  out 
their  plans  are  entitled  to  the  highest  praise  and  greatest  credit, 
and  we  fire  insurance  men  are  proud  to  know  that  we  were  a  re- 
mote but  a  very  important  factor  in  the  foundation  of  the  pros- 
perity that  made  the  Fair  possible  and  that  we  are  at  this  an  ab- 
solutely necessary  factor  in  its  operating  economy,  by  furnishing 
indemnity  security  against  loss  by  fire  on  the  enormous  values  of 
property  subject  to  the  congested  frame  building  fire  hazard. 

This  short  talk  gives  you  some  idea  of  the  relation  of  fire  insur- 
ance to  business.  The  great  questions  of  taxation,  supervision  and 
other  legalized  burdens  that  all  kinds  of  insurance  arc  subject  to, 
will  be  treated  by  the  speakers  who  succeed  me. 


WORLD'S  INSURANCE  CONGRESS  275 


TAXATION  OF  INSURANCE  COMPANIES  FOR  REVENUE 

By  F.  Robertson  Jones 
Secretary-Treasurer,  Workmen's  Compensation  Publicity  Bureau 

The  distinguished  English  economist,  Professor  W.  S.  Jevons, 
has  remarked  that  a  kind  of  intellectual  vertigo  attacks  all  who 
treat  the  fatal  theme  of  money.  The  statement  is  no  less  true,  I 
believe,  when  taxation  is  the  subject  under  discussion.  Legislators 
and  State  officials  in  particular  and  the  public  in  general  seem  to 
lose  their  heads  when  this  subject  is  up  for  practical  consideration. 
Skilled  politicians  and  hard-headed  business  men,  who  are  accus- 
tomed to  submit  every  important  proposition  to  the  acid  test  of 
common  sense,  will  make  the  most  egregious  blunders  and  will 
seemingly  throw  to  the  winds  their  native  logical  endowments 
when  they  are  called  upon  to  provide  an  equitable  method  of  secur- 
ing revenues  to  meet  the  demands  of  the  State.  The  subject,  of 
course,  is  not  a  simple  one,  as  is  well  illustrated  by  the  divergence 
of  opinion  among  economists  themselves,  even  as  regards  its  most 
elemental  principles.  The  literature  upon  the  subject  is  replete 
with  evidence  of  this  fact ;  and  even  the  four  maxims  respecting 
taxation  set  forth  by  Adam  Smith  have  been  hacked  at  until 
scarcely  a  splinter  remains  intact,  although  they  were  very  gen- 
erally concurred  in  by  economists  immediately  subsequent  to  Smith 
and  were  thought  to  have  become  classical.  They  have  been  quoted 
over  and  over  again  as  if  they  contained  truths  of  great  moment; 
but,  if  carefully  analyzed,  they  seem  entirely  inadequate  to  the 
economist  of  to-day. 

Whatever  may  be  the  divergence  of  opinion  among  the  authori- 
ties with  respect  to  the  principles  that  should  underlie  a  system 
of  taxation,  there  is  little  or  no  difference  of  opinion  among  the 
laity  as  to  the  undesirability  of  paying  any  taxes  whatever.  Aside 
from  a  general  acceptance  in  the  abstract  of  the  necessity  of  levy- 
ing taxes  and  the  necessity  of  somebody  paying  them,  we  are  all  of 
us,  as  individuals  or  as  managing  officials  of  corporations,  either 
consciously  or  unconsciously  making  every  effort  to  bear  as  little 
of  that  burden  as  possible. 

This  paper,  however,  is  not  a  plea  for  the  total  exemption  of 
insurance  companies  from  taxation;  it  is  only  just  that  the  insur- 
ance companies  should  be  taxed  sufficiently  to  pay  for  the  insur- 
ance departments  of  their  respective  States  and  thus  relieve  the 
State  of  an  expense  to  which  they  subject  it.  They  should  not, 
however,  be  taxed  in  excess  of  this ;  for  a  tax  on  insurance,  causing, 
as  it  does,  an  increase  in  the  cost  of  insurance  to  the  assured,  and 
so  lessening  the  amount  of  insurance  purchased,  is  an  anti-social 
tax.  In  states  where  the  present  tax  is  in  excess  of  this  minimum 
necessary  to  cover  the  expense  of  the  insurance  department,  the 


276  WORLD'S  INSURANCE  CONGRESS 

tax  should,  therefore,  be  reduced  to  such  an  amount.  And  further- 
more, this  amount  should  be  raised  by  means  of  a  general  State 
tax — no  recourse  being  had  to  the  various  local  and  special  forms 
of  taxation  by  which  insurance  companies  are  now  harassed.  This 
general  tax  should  be,  as  far  as  practicable,  uniform  as  between 
the  various  classes  of  insurance  companies  and  the  different  States 
— where  lack  of  such  uniformity  frequently  causes  the  enactment 
of  retaliatory  laws. 

Such  a  reduction  in  the  amount  of  the  tax  on  insurance  com- 
panies could  be  easily  obtained  did  the  policyholders  and  legis- 
lators understand  by  whom  this  tax  is  really  paid.  I  find,  however, 
that  there  is  a  very  general  misconception  on  the  part  of  the 
legislators  and  citizens  of  the  various  States  as  to  who,  ultimately, 
bears  the  burdens  of  the  taxes  upon  insurance  companies.  They 
almost  uniformly  argue  that  the  money  is  taken  not  from  the  peo- 
ple of  their  State,  but,  for  the  most  part,  from  insurance  corpora- 
tions of  other  States ;  that  the  Texas  tax,  for  instance,  is  drawn 
largely  from  companies  chartered  in  New  York,  Connecticut, 
Massachusetts,  Maryland  or  Illinois;  and  that  consequently  the 
people  of  Texas  are  just  to  that  extent  relieved  from  the  burden 
of  taxation.  Nothing  could  be  farther  from  the  truth  or  more 
illogical  than  such  a  statement.  An  insurance  company,  in  what- 
ever State  chartered,  of  its  very  nature  is  only  a  "handler"  of  the 
premiums  that  it  collects  from  policyholders.  It  does  not  create 
values  in  the  same  sense  that  a  shoe  factory  does.  It  merely  col- 
lects premiums  from  the  many  to  pay  a  large  percentage  of  them 
out  again  to  the  few  who  are  unfortunate  enough  to  meet  with 
accidents.  Stated  differently,  the  insurance  company  is  nothing 
more  than  a  clearing-house  as  between  the  many  who  purchase 
insurance  to  protect  themselves  against  future  catastrophes  and 
the  few  of  their  number  who  actually  meet  with  such  catastrophes 
— the  only  percentage  of  such  purchase  money  (premiums)  re- 
tained by  the  insurance  company  is  that  necessary  to  ensure  a  fair 
return  to  invested  capital  and  to  pay  the  costs  of  the  business. 

Those  who  argue  thus  illogically  (that  taxes  collected  from  in- 
surance companies  foreign  to  their  State  do  not  come  out  of  their 
own  people)  lose  sight  of  a  very  important  fact.  A  going  concern 
must  load  every  item  of  additional  expense  upon  the  costs  to  the 
policyholder — otherwise  it  would  either  show  no  adequate  return 
to  capital  invested  or  would  ''go  broke"  in  short  order;  for  free 
and  spirited  competition  between  insurance  companies  has  already 
reduced  the  costs  of  the  business  as  low  as  possible,  so  that  no 
saving  can  be  effected  in  them  towards  paying  the  tax.  If  a  tax 
is  imposed  upon  the  companies,  there  is  nothing  for  them  to  do 
but  to  load  the  amount  of  the  tax  upon  the  premiums  charged 
to  the  policyholder.  And  only  to  the  extent  that  this  increase  in 
the  cost  of  premiums  prevents  the  as  yet  uninsured  from  becoming 
insured,  or  the  already  insured  from  purchasing  additional  insur- 
ance, does  the  tax  affect  the  insurance  company.     If  the  assured 


WORLD'S  INSURANCE  CONGRESS  277 

pays  one  hundred  dollars  ($100.00)  annually  for  a  personal  acci- 
dent insurance  policy — the  cost  of  which,  if  there  were  no  tax, 
would  be  ninety-three  dollars  ($93.00) — his  power  to  purchase 
more  insurance  is  lessened  by  exactly  the  amount  of  the  tax.  When 
Ohio  collected  from  insurance  companies  in  1912  a  million  and  a 
third  dollars  in  taxes,  the  companies  were  compelled  to  load  just 
that  additional  amount  upon  their  premiums;  and,  by  doing  so, 
lessened  the  annual  power  of  the  policyholders  of  Ohio  to  pur- 
chase additional  insurance  of  a  million  and  a  third  dollars.  It 
is  in  this  M'ay  that  the  tax  affects  the  insurance  companies;  it 
lessens  the  amount  of  insurance  purchased. 

The  real  incidence  of  the  tax  upon  insurance  companies  is  thus 
thrust  upon  the  policyholder  in  increased  premiums;  or  else,  in 
case  competition  for  the  time  being  interferes  with  the  smooth 
working  of  economic  laws,  the  financially  weaker  companies  are 
driven  to  a  point  below  the  margin  of  financial  safety.  This  leads 
me  to  make  the  statement,  somewhat  parenthetically,  that  it  is 
never  to  the  interest  of  the  public  in  general  or  the  policyholder 
that  insurance  companies  should  be  induced  to  charge  very  low 
premiums  or  insurance  rates ;  it  is  rather  very  much  indeed  to  their 
interests  that  the  companies  should  be  compelled  to  charge  ade-" 
quate  insurance  rates — and  by  ' '  adequate ' '  I  mean  rates  that  will 
insure  their  financial  solvency.  The  public,  instead  of  urging  leg- 
islation compelling  a  reduction  in  insurance  rates  irrespective  of 
considerations  of  safety,  should  on  the  contrary  urge  their  legisla- 
tors to  enact  laws  compelling  insurance  companies  to  charge  ade- 
quate rates.  For,  in  the  last  analysis,  insurance  is  nothing  more 
or  less  than  a  special  manifestation  of  the  ordinaiy  pripciple  of 
banking.  We  have  fairly  good  laws  controlling  the  conduct  of 
banks — the  whole  object  of  such  laws  being  to  conserve  the  finan- 
cial responsibility  of  such  banks  in  the  interests  of  the  depositors 
and  of  the  public.  What  should  we  think  of  a  law  requiring  banks 
to  charge  no  more  than  three  per  cent  interest  when  five  or  six 
per  cent  is  the  measure  of  the  money  market  conditions  in  a  par- 
ticular locality?  Or  of  a  law  permitting  banks  to  lend  out  all  of 
their  money  and  prohibiting  them  from  establishing  adequate  re- 
serves ? 

That  the  policyholder,  in  the  last  analysis,  must  indisputably  pay 
the  insurance  tax  is  a  fact  recognized  by  the  insurance  officials 
of  most  of  the  States.  They  have  declared  themselves  to  that 
effect  upon  numerous  occasions  and  in  numerous  reports.  A  great 
deal  of  credit,  too,  is  due  them  for  their  courage  in  thus  express- 
ing frankly  their  convictions;  for  they  realize  better  than  any  one 
else  the  danger  of  advocating  an  unpopular  cause  and  of  running 
counter  to  what  many  State  officials  and  legislators  believe  to  be 
the  best  interests  of  their  State.  Many  of  the  insurance  commis- 
sioners are  appointed  bj^  the  governor,  some  are  elected,  and  all 
are  more  or  less  subject  to  popular  clamor  as  to  the  length  of  their 
tenure  of  office.     Therefore,  it  is  a  real  act  of  courage  for  them 


278       WORLD'S  INSURANCE  CONGRESS 

to  put  themselves  on  record  in  the  unqualified  manner  in  which 
they  have  done  so;  for  they  have  nothing  immediate  to  gain  by 
such  advocacy,  and  in  some  cases  much  to  lose. 

In  the  thirty-eighth  annual  report  of  the  Michigan  Insurance 
Department,  that  exponent  of  a  "square  deal"  for  everybody, 
James  V,  Barry,  then  Commissioner,  wrote  as  follows: 

"It  will  be  seen,  therefore,  that  during  the  last  fiscal  year  ]\richi- 
gan  collected  from  the  insurance  companies  authorized  to  transact 
business  in  this  state,  $46-4,871.02  in  excess  of  the  total  cost  of 
conducting  the  insurance  department  of  the  State.  The  aggregate 
of  fees  and  taxes  annually  paid  by  the  insurance  companies  to  the 
various  States  of  the  Union  is,  in  round  numbers,  $12,000,000.00 
(approximately  $20,000,000.00  in  1914)  while  the  cost  of  main- 
taining the  several  insurance  departments  is  but  $2,000,000.00 
Inasmuch  as  all  this  vast  sum  is  paid  by  policyholders  in  the  shape 
of  increased  rates,  the  justness  and  expediency  of  the  tax  is  a 
matter  worthy  of  serious  consideration." 

Commissioner  James  R.  Young  of  North  Carolina  expresses  him- 
self very  much  in  the  same  way  in  his  report  on  1912  business.  I 
quote  a  paragi'aph  as  follows : 

"As  has  been  stated  frequently  by  the  Insurance  Commissioner 
in  his  reports  and  recommendations,  he  has  not  undertaken  to  run 
the  department  for  revenue.  The  Commissioner  and  those  who 
have  had  occasion  to  look  into  the  matter  are  satisfied  that  more 
good  is  accomplished  for  the  state  and  her  citizens  by  a  proper 
supervision  of  the  business  than  by  the  collection  of  taxes." 

An  additional  reference  will,  I  believe,  suffice  to  show  the  atti- 
tude of  insurance  commissioners — I  refer  to  the  Thirt^'-third  an- 
nual report  (business  of  1914)  of  Hon.  D.  M.  Rolph  of  Colorado: 

"The  fees  and  taxes  collected  by  this  department  are  fifteen 
times  more  than  the  cost  of  its  operation.  Inasmuch  as  the  two 
per  cent  tax  on  premiums  paid  for  insurance  protection  is  a  tax 
upon  the  insuring  public,  and  is  expended  for  purposes  other  than 
the  supervision  of  insurance  companies,  it  is  an  injustice  to  the 
citizens  of  Colorado  and  I  reconnnend  that  it  be  reduced  to  one 
per  cent.  This  suggestion  is  in  conformity  with  a  uniform  move- 
ment throughout  the  United  States  to  equalize  the  taxes  of  in- 
surance companies  for  the  various  States.  One  per  cent  with  the 
other  fees  would  still  leave  an  income  that  would  provide  for  all 
operating  expenses  of  the  department  and  for  any  unforeseen  con- 
tingencies that  might  arise." 

Thus,  with  few  exceptions,  the  commissioners  criticize  the  tax  on 
the  ground  that  it  is  paid  by  the  policyholder — as  one  might  put 
it,  by  the  consumer  of  the  insurance.  "But  why  not?"  asks  the 
student  of  economics.     "So  the  tax  on  any  connnodity— cigars  or 


WORLD'S  INSURANCE  CONGRESS  279 

liquor  or  whatever  it  may  be — is  paid  by  the  consumer  of  that 
commodity.  Why  is  this  so  undesirable  in  the  case  of  the  tax 
on  insurance?"  Precisely  because  this  tax,  being  paid  by  the 
policyholder,  is  a  tax  on  two  of  the  greatest  of  social  virtues — 
thrift  and  providence  for  the  want  attendant  upon  calamity. 
"Human  misfortune  and  sorrow,"  said  E.  E.  Rittenhouse  when 
Colorado  Commissioner  of  Insurance,  "are  made  to  pay  tribute  to 
the  State  treasury.  It  is  true  that  the  tax-gatherer  is  not  at  the 
bedside  of  the  sick  or  injured,  or  of  the  dying,  demanding  for  the 
State  its  calamity  tax.  It  is  collected  in  advance  from  the  pre- 
miums. Why  should  the  State  tax  this  man  (the  insured)  for  his 
most  worthy  and  commendable  act  in  guarding  his  family  from 
misery  and  want  after  he  has  passed  away?  If  this  is  a  fair  and 
honorable  thing  to  do,  would  it  not  also  be  fair  and  honorable 
to  demand  a  portion  of  the  contents  of  the  contribution  boxes  at 
our  churches,  for  these  offerings  are  often  also  collected  for  the 
benefit  of  the  sick  and  injured  in  the  hospitals,  and  for  the  widows 
and  the  orphans,  as  well  as  for  other  benevolent  purposes. 

Thomas  E.  Drake,  formerly  Superintendent  of  the  Insurance 
Department  of  the  District  of  Columbia,  likened  the  tax  on  insur- 
ance companies  to  a  tax  on  schools  and  churches. 

"Health  and  accident  insurance,"  writes  the  Minnesota  Com- 
missioner (Report  for  1912),  "is  the  poor  man's  insurance.  It 
has  well  been  termed  bread  and  butter  insurance." 

The  ]\Iissouri  Commissioner  says  in  his  1909  report: 

"Life  insurance  is  an  indispensable  incident  to  modern  civiliza- 
tion. It  is  an  equalizer  of  good  fortune  and  of  misfortune;  an 
incentive  to  thrift,  and  performs,  in  a  large  measure,  functions 
which  otherwise  would  fall  upon  the  State." 

And  it  is  as  a  tax  on  thrift  that  Robert  J.  Merrill,  Insurance 
Commissioner  of  New  Hampshire,  criticizes  the  tax  on  insurance. 
His  recent  report  shows  such  an  insight  into  the  practical  side  of 
the  problem  that  I  cannot  refrain  from  quoting  a  paragraph  or 
tM^o,  as  follows: 

' '  This  department  has  turned  into  the  State  treasury  during  the 
fiscal  year  upwards  of  one  hundred  thousand  dollars.  The  Legis- 
lature appropriated  for  its  maintenance  $6,800 — a  clear  profit  of 
more  than  $94,000.  This  statement  is  not  made  for  the  purpose 
of  asking  that  any  particular  credit  be  given  on  account  of  this 
showing.  The  revenue  was  collected  because  the  law  provided  it 
should  be.  There  is  no  reason  why  the  State  should  exact  these 
large  sums  each  year,  exacted  not  from  the  insurance  companies, 
hut  really  frora  the  citizens  of  our  oivn  state,  who  are  thrifty 
enough  to  insure  their  future  independence  in  some  degree.  But 
there  seems  to  be  little  reason  for  expecting  any  change  in  this 
particular  as  long  as  taxation  continues  to  be  based  upon  the  idea 
of  securing  as  much  as  possible  from  convenient  and  defenseless 


280  WORLD'S  INSURANCE  CONGRESS 

reservoirs  of  funds,  the  tapping  of  which  does  not  apparently  in- 
terest the  man  with  the  vote." 

Commenting  upon  Mr.  Merrill's  statement,  an  insurance  com- 
pany paper   (Travelers)   uses  the  following  apt  illustration: 

"If  village  neighbors  collected  $1,000  for  a  destitute  widow  and 
her  orphans  and  were  met  at  her  house  by  a  tax-gatherer  demand- 
ing $70  he  would  probably  be  mobbed.  Yet  this  is  what  our  States 
take  from  every  $1,000  paid  to  the  widows — and  all  because  agents 
and  policyholders  stand  by  and  assent  to  its  being  done,  and  some 
policyholders  even  censure  the  officers  for  endeavoring  to  prevent 
increased  taxation  and  then  demand  cheaper  insurance." 

I  am  very  glad  to  say,  too,  that  the  principle  advocated  by  Mr. 
Barry  has  been  fortified  and  amplified  by  one  of  his  successors, 
John  T.  AVinship,  who  in  the  forty-fifth  Michigan  report  (business 
of  1914)  expresses  himself  unequivocally  as  follows: 

"The  gross  receipts  of  the  state  insurance  department  for  the 
last  year  amounted  to  $737,973.42,  the  greatest  in  the  history  of 
the  insurance  department.  .  .  . 

"This  would  not  be  so  bad  were  it  drawn  unifonnly  from  all 
citizens,  but  it  is  only  drawn  from  the  provident,  those  who  real- 
ize the  necessity  of  insurance.  From  an  economic  standpoint,  it 
must  be  admitted  that  the  taxation  of  insurance  premiums  is  a 
tax  upon  thrift  and  prudence.  So  long  as  the  department  can  be 
supported  by  the  retaliatory  fees  exacted  from  insurance  com- 
panies there  seems  to  be  little  practical  sense  in  exacting  the  enor- 
mous taxation  on  premium  income  from  the  companies,  when  it 
is  positively  known  that  in  making  the  premium  rates  they  add 
the  taxation  cost,  and  our  own  people  pay  it.  If  insurance  were  a 
luxurv  there  might  be  an  argument  in  favor  of  this  peculiar  method 
of  doing  business,  but  it  is  not  a  luxury;  it  is  a  necessity.  Life 
insurance  relieves  the  drain  upon  the  poor  funds  of  the  various 
municipalities  and  counties  and  upon  the  charitable  institutions 
of  the  State,  and  as  for  fire  insurance  its  abandonment  would  stop 
the  wheels  of  commerce." 

The  same  may  be  said,  wath  practically  an  equal  amount  of 
truth,  of  the  various  classes  of  casualty  insurance.  As  a  matter 
of  fact,  the  National  Convention  of  Insurance  Commissioners,  an 
organization  of  the  insurance  commissioners  of  all  the  States,  has 
from  time  to  time  declared  against  excessive  taxation  of  insurance 
companies  in  the  most  emphatic  terms. 

This  attitude  of  the  commissioners  is  well  fortified  by  the  best 
economic  thought  upon  the  subject.  The  noted  English  economist, 
John  Stuart  Mill,  in  his  "Principles  of  Political  Economy"  (Vol. 
11,  page  463),  condemns  the  tax  upon  insurance  as  follows: 

"Some  of  the  taxes  on  contracts  are  very  pernicious,  imposing 
a  virtual  penalty  upon  transactions  which  ought  to  be  the  policy 


WORLD'S  INSURANCE  CONGRESS       281 

of  the  legislator  to  encourage.  Of  this  sort  is  .  .  .  the  tax  on 
insurance  (which  is)  a  direct  discouragement  of  prudence  and 
forethought.  ...  If  this  tax  (i.e.,  a  heavy  fire  insurance  tax) 
existed  in  France,  we  should  not  see,  as  we  do  in  some  of  her 
provinces,  the  plate  of  an  insurance  company  on  almost  every  cot- 
tage or  hovel.  ...  A  tax  of  so  extravagant  an  amount  would 
he  a  heavy  drag  upon  any  habits  of  providence." 

The  economist,  McCullough,  accepts  this  view  of  Mill,  when  he 
states  that  such  a  tax  "discourages  that  providence  and  fore- 
thought, encouragement  of  which  ought  to  be  an  object  with  all 
prudent  governments;"  and  ''Seeing  the  vast  importance  of  in- 
surance, it  may  well  be  doubted  whether  it  ought  to  be  charged 
with  any  duty,  however  slight." 

In  condemning  taxation  of  insurance  on  the  grounds  of  its  being 
a  "tax  on  thrift,"  I  do  not  mean  a  tax  on  money  saved  as  a  result 
of  thrift.  All  taxes  are,  in  this  sense,  taxes  on  thrift ;  for  they 
must  be  drawn  from  the  surplus  of  wealth  over  and  above  that  re- 
quired to  sustain  a  minimum  of  existence — a  surplus  which  is  cre- 
ated by  thrift.  You  cannot  collect  taxes  from  the  man  who  has 
nothing,  or  who  has  only  just  enough  to  sustain  life,  unless  you 
return  it  to  him  in  the  form  of  charity.  In  condemning  the  taxa- 
tion of  insurance  as  taxation  of  thrift,  we  mean  of  the  very  act 
and  process  of  thrift,  by  which  the  assured  provides  against  future 
want  attendant  upon  catastrophe — whether  death,  injury,  sickness, 
or  the  destniction  or  loss  of  property  by  fire  or  other  accidental 
cause.  As  such,  the  taxation  of  insurance  is  in  the  highest  degree 
anti-social. 

It  is  therefore  desirable  to  reduce  this  taxation  to  the  lowest 
practical  amount — that  is,  to  the  point  where  it  just  covers  the  ex- 
pense of  the  State  insurance  department.  To  what  extent  taxation 
is  now  in  excess  of  this  amount  may  be  seen  by  a  cursory  examina- 
tion of  the  reports  of  the  State  departments. 

The  fees  and  taxes  collected  by  the  Colorado  and  New  Hamp- 
shire insurance  departments  during  1914,  for  instance,  were  more 
than  fifteen  times  the  cost  of  their  operation ;  while  in  Missouri,  in 
1909,  they  were  about  twenty-three  and  a  half  times.  In  compari- 
son with  Georgia,  Iowa  and  Ohio,  however,  those  figures  sink  into 
insignificance,  for,  during  1912,  nearly  fifty  times  as  much  was 
taken  by  Georgia  from  the  insurance  companies  in  taxes  as  was 
needed  for  the  expenses  of  the  department;  while  in  Ohio  and 
Iowa  (1914)  it  was  nearly  forty  and  fifty  times  as  much  respec- 
tively. There  are  a  number  of  other  States  that  have,  from  year 
to  year,  averaged  anywhere  from  twenty  to  twenty-five  times  the 
amount. 

The  gross  receipts  from  the  tax  in  many  States  reach  a  high 
figure.  In  1912,  Ohio  collected  from  insurance  companies  over  a 
million  and  a  third  dollars;  Iowa,  in  1914,  over  half  a  million 
dollars;  Wisconsin,  in  1911,  over  three-quarters  of  a  million  dol- 


282  WORLD'S  INSURANCE  CONGRESS 

lars;  Michigan,  in  1913,  over  three-fifths  of  a  million  dollars;  while 
the  relatively  small  industrial  States  of  North  Carolina  and  Ok- 
lahoma collected  approximately  one-quarter  of  a  million  dollars 
each  on  1912  business,  and  Tennessee  and  ^Taryland,  over  four 
hundred  thousand  dollars  and  three  hundred  thousand  dollars  re- 
spectively. These  various  State  insurance  taxes,  taken  together 
with  fees,  etc.,  run  in  the  aggregate  all  the  way  up  to  seven  per 
cent  or  more  of  the  grass  premium  income  of  some  classes  of  insur- 
ance companies. 

Not  merely  in  quantit}',  however,  but  in  kind,  the  present  taxa- 
tion of  insurance  is  objectionable.  In  addition  to  the  State  per- 
centage tax  upon  gross  premiums  (minus,  usually,  reinsurance 
premiums  and  returned  premiums  on  cancelled  policies) — averag- 
ing approximately  two  per  cent — there  are  collected  numerous 
fees,  etc.,  by  the  State  and  local  governments.  These,  I  find,  include 
approximately  twenty-six  separate  kinds.  An  insurance  company 
never  files  a  scrap  of  paper,  secures  a  statement  of  any  kind,  nor 
exercises  any  of  its  legitimate  prerogatives  without  having  to  pay 
a  fee  or  license  of  some  kind.  In  some  local  instances  such  pay- 
ments aggregate  more  than  the  company's  receipts.  In  addition 
to  the  premium  tax,  fees,  licenses,  etc.,  the  companies  have  to  pay 
in  some  States  franchise  taxes,  fire  marshal  taxes,  and  make  special 
deposits  of  cash  or  securities.  The  report  of  the  Virginia  Joint 
Committee  on  Tax  Revision  has  a  paragraph  upon  this  subject  as 
follows : 

"At  present  the  revenue  derived  by  the  Government  from  those 
engaged  in  the  business  of  insurance  is  made  up  of  a  multitude 
of  different  fees,  charges  and  taxes.  Every  insurance  company 
must  pay  the  charter  fees,  franchise  and  registration  charges  re- 
quired of  all  corporations;  it  pays  a  license  tax  of  $200.00  to  the 
state;  it  pays  another  tax  for  the  support  of  the  Bureau  of  In- 
surance, and  a  $5.00  annual  fee  for  a  license  certificate ;  it  makes 
a  small  payment  for  the  care  of  the  securities  which  it  is  required 
by  law  to  deposit  with  the  Treasurer;  it  pays  on  its  real  estate 
aiid  tangible  property;  it  pays  a  State  tax  levied  on  premium  in- 
come ;  it  must  make  to  each  municipality  for  the  privilege  of  trans- 
acting business  a  license  payment  which  varies  from  place  to  place 
in  form  and  amount  but  which  is  usually  levied  without  regard 
to  the  amount  of  business  done ;  and,  in  addition  to  all  this,  a  com- 
pany chartered  by  Virginia  must  pay  under  a  statute  that  is  ob- 
scurely worded  and  difficult  of  construction,  a  tax  on  its  capital 
to  the  State  and  to  the  locality  where  it  has  its  home  office." 

At  this  point,  I  cannot  avoid  the  temptation  to  indulge  in  a  di- 
gression from  the  strict  limits  of  the  subject  of  this  paper  to  con- 
demn what  I  consider  to  be  possibly  the  most  objectionable  of  all 
charges  upon  the  income  of  insurance  companies — one  that  brings 
no  revenue  to  the  State  and  confers  no  advantage  on  the  insuring 
public— I  refer  to  that  type  of  "graft"  that  has  been  fastened 


WORLD'S  INSUEANCE  CONGRESS  283 

upon  insurance  companies  in  many  States,  namely,  the  compulsory 
advertising  of  abstracts  of  annual  tinancial  statements  in  news- 
papers of  various  cities  and  counties. 

More  than  half  our  States  require  such  publication ;  and  the 
requirement  is  obviously  a  flagrant  case  of  the  exercise  of  polilu-a! 
influence  by  the  newspapers.  These  requirements  range  all  the 
way  from  that  of  Delaware,  where  the  State  pays  the  cost,  to  thai 
of  Maryland,  where  such  abstract  must  be  published  not  only  once 
a  week  for  three  consecutive  weeks  in  a  daily  newspaper  pub- 
lished in  the  city  of  Baltimore,  but  likewise  in  at  least  one  other 
newspaper  three  times,  and  also  in  a  newspaper  in  each  of  the 
counties  of  the  State  where  the  company  in  question  transacted 
business  during  the  preceding  year.  This  species  of  imposition 
goes  far  to  illustrate  the  fact  that  insurance  companies  are  by 
some  legislators  considered  easy  and  legitimate  prey.  They  have 
the  ready  money  and  they  are  not  in  a  position  to  avoid  the  hun- 
gry wolves.  The  imposition  of  such  burdens  as  this,  not  to  speak 
of  the  large  and  increasing  State  taxes,  is  not  consistent  with  the 
criticism,  on  the  part  of  some  legislators,  of  the  premium  rates 
charged  by  insurance  companies  and  the  passing  by  these  legisla- 
tors of  drastic  and  unreasonable  laws  ostensibly  to  regulate  those 
rates  but  in  fact  to  push  them  down  below  the  margin  of  financial 
safety.  Our  legislators  demand  that  insurance  companies  charge 
less  and  less  for  their  policies,  but  nevertheless  proceed  to  enact 
laws  placing  not  only  additional  tax  burdens  upon  them,  but  like- 
wise unwarranted  costs  such  as  the  compulsory  publication  of  ab- 
stracts of  financial  statements — all  of  which  burdens,  of  course, 
must  be  reflected  ultimately  in  the  additional  cost  of  insurance  to 
the  policyholders. 

There  is,  however,  a  very  well-defined  sentiment  among  the  in- 
surance commissioners  of  the  various  States  to  the  effect  that  this 
requirement  of  the  publication  of  abstracts  of  financial  statements, 
besides  raising  the  cost  of  insurance,  it  is  absolutely  useless.  As 
representative  of  this  intelligent  and  fair-minded  attitude  of  the 
insurance  commissioners,  permit  me  to  quote  from  the  thirty-third 
annual  report  of  Hon.  D.  M.  Rolph,  Commissioner  of  Insurance  of 
Colorado,  as  follows: 

"The  laws  of  this  State  require  every  insurance  company  doing 
business  herein  to  publish  in  a  newspaper  of  general  circulation 
annually  a  synopsis  of  its  financial  condition  and  a  copy  of  its 
certificate  of  "authority  from  the  Commissioner  of  Insurance.  The 
Commissioner  is  of  the  opinion  that  this  publication  is  of  little 
value  to  the  citizens  of  this  state ;  is  an  additional  expense  to  the 
companies,  and  is  ultimately  paid  by  Colorado  policyholders.  This 
law  should  be  repealed.  This  recommendation  is  in  accordance 
with  the  uniform  movement  throughout  the  United  States  to  re- 
peal similar  laws. ' ' 

I  could  quote  similar  expressions  of  opinion  by  insurance  com- 
missioners;  but  I  think  the  one  quoted  above  is  sufficient  to  illus- 


284       WORLD'S  INSURANCE  CONGRESS 

trate  the  point.  It  is  an  imposition  almost  of  the  nature  of  a 
nuisance  and  should  be  abated  by  all  right-minded  citizens  and 
legislators  at  the  earliest  possible  date. 

The  argument  advanced  by  those  who  believe  that  insurance 
companies  should  be  subjected  to  this  expense  (if,  perchance,  they 
advance  any  at  all),  is  that  the  public  in  general  and  policyholders 
in  particular  of  the  State  in  question  wiU  be  enabled  by  this  ab- 
stract of  financial  statements  to  determine  for  themselves  not  only 
the  individual  financial  condition  of  the  companies  publishing  it 
but  likewise  their  relative  financial  condition.  That  argument  is 
grounded  on  three  false  assumptions,  namely,  that  the  public  will 
read  the  statements;  and,  reading  it,  will  understand  it;  and,  un- 
derstanding it,  will  make  logical  deductions.  The  public,  in  gen- 
eral, will  not  do  any  one  of  these  three  things;  they  will  not  read 
the  statement;  they  would  not  understand  it  if  they  did  read  it; 
and  they  would,  as  a  rule,  not  arrive  at  accurate  conclusions  as  to 
the  relative  financial  merits  of  various  companies  even  though  they 
grasped  the  significance  of  the  individual  statements ;  for  the  ab- 
stracts published  are  so  brief  and  the  subject-matter  so  technical 
that  it  would  probably  take  a  trained  actuary  to  arrive  at  right 
conclusions. 

Even  though  we  granted,  for  the  sake  of  argument,  the  ability 
of  the  general  public  to  arrive  at  right  conclusions  from  the  publi- 
cation of  abstracts  of  financial  statements,  yet,  under  the  present- 
day  system  of  close  supervision  of  insurance  companies  by  State 
departments  of  insurance,  such  publication  is  unnecessary  and 
hence  wasteful;  the  Insurance  Commissioner  is  the  one  to  whom 
the  public  should  look  for  guidance  in  matters  of  this  kind.  He 
has  the  facts  and,  usually,  trained  actuaries  to  interpret  these 
facts.  Furthermore,  he  has  the  power  to  issue  and  revoke  the 
licenses  of  insurance  companies  of  other  States  doing  business  in 
his  State.  Consequently  this  required  publication  of  abstracts  of 
financial  statements  serves  no  purpose  whatsoever:  except  that 
of  harassing  the  insurance  companies,  already  subject,  as  we 
have  seen,  to  the  vexation  of  a  score  of  petty  forms  of  taxation  in 
addition  to  the  general  State  tax. 

That  this  tax  burden  is  increasing  from  year  to  year  will  not 
admit  of  contradiction— the  annual  reports  of  the  commissioners 
demonstrate  this  fact  clearly.  Not  only  does  the  gross  amount 
collected  increase  (which  is  the  natural  outcome  of  a  normal  in- 
crease in  the  volume  of  insurance  written)  but  either  the  percent- 
age of  the  tax  itself  increases  or  the  number  of  kinds  of  tax — and 
in  some  cases  both.  An  analysis  of  the  bills  introduced  in  the  va- 
rious legislatures  of  the  country  during  the  past  few  years  will 
demonstrate  this  fact. 

Robert  Lynn  Cox,  Manager  of  the  Association  of  Life  Insurance 
Presidents,  in  his  report  for  1915,  says: 


WORLD'S  INSURANCE  CONGRESS  285 

"The  increase  in  measures  for  the  taxation  of  life  insurance 
companies  is  distinctly  alarming.  It  is  very  evident  that  this  situ- 
ation causes  public  unrest  among  the  various  States  dealing  with 
the  subject  of  taxation.  The  increased  cost  of  conducting  State 
governments  must  be  provided  for  in  some  way,  and  the  tendency 
is  towards  securing  the  additional  revenue  needed  by  taxing  life 
insurance  companies." 

He  might  have  said  "All  kinds  of  insurance  companies." 
Mr.  Cox  also  points  out  that,  while  in  a  similar  period  two  years 
ago  the  tax  bills  introduced  numbered  only  302,  the  first  five 
months  of  1915  produced  734  measures  of  this  character.  Al- 
though not  all  of  these  bills  became  laws,  yet  a  respectable  percent- 
age of  them  did. 

The  reasons  for  this  increase  in  taxation  of  insurance  compa- 
nies are  manifold;  but  perhaps  among  the  most  important  of 
them  are  the  well-pronounced  movement  toward  prohibition  of  the 
sale  of  liquor  resulting  in  the  loss  of  revenue  from  that  source; 
the  growing  budgets  of  the  various  States;  and  the  more  general 
appreciation  of  the  legislators  of  the  golden  opportunities  afforded 
them  of  getting  easy  and  ready  money  from  insurance  companies. 
The  elimination  of  the  liquor  traffic  has  brought  about  a  real  and 
pressing  deficit  in  the  revenues  of  a  number  of  our  states;  and 
their  legislators,  compelled  to  look  around  for  new  or  augmentable 
sources  of  revenue  to  fill  the  state 's  depleted  money-chest,  naturally 
tap  those  reservoirs  which  experience  has  shown  produce  the  largest 
supply  and  furnish  the  least  resistance,  viz.,  the  insurance  cor- 
porations. 

A  good  illustration  of  this  fact  may  be  found  in  the  attitude  of 
the  Virginia  Joint  Committee  on  Tax  Revision  (to  which  reference 
has  already  been  made)  which,  during  the  past  year,  has  been  giv- 
ing considerable  attention  to  a  general  reconstruction  of  the  tax 
system  of  that  State.  The  members  of  this  committee,  at  public 
hearings,  tentatively  and  unofficially  expressed  the  opinion  that 
they  thought  insurance  companies  were  taxed  too  heavily ;  and  that 
not  only  should  the  general  tax  be  reduced  but  the  local  taxes 
eliminated  altogether.  This  view,  however,  was  immediately  quali- 
fied in  the  statement  that  neither  proposition  would  receive  favor- 
able consideration  by  the  legislature,  for  a  fertile  source  of  State 
revenue  would  be  eliminated  when  the  prohibition  law  went  into 
effect  and  the  deficiency  would  have  to  be  made  up  in  "some  way." 
An  increase  in  the  tax  upon  realty  or  upon  local  manufacturing 
industries  would  not  only  bring  about  violent  resistance  on  the  part 
of  those  affected,  but  would  likewise  bring  about  political  retalia- 
tion. They  thought,  too,  that  the  local  State  administrative  divi- 
sions would  be  loath  to  give  up  their  fertile  source  of  revenue 
from  the  insurance  companies ;  in  other  words,  that  the  * '  dog  had 
the  bone  in  his  mouth  and  that  he  would  not  give  it  up  execept 
under  extreme  compulsion." 


286  AVORLD'S  INSURANCE  CONGRESS 

Consequently,  aside  from  an  equalization  of  the  tax  as  between 
different  kinds  of  insurance  companies,  about  the  only  alleviation 
recommended  by  the  Virginia  Committee  in  its  report  of  1914  was 
"that  the  municipal  license  charges  be  abolished  and  that  these 
and  other  payments  be  consolidated  into  one  tax  levied  on  the  gross 
income  from  premiums  collected  in  Virginia." 

Both  of  these  measures,  the  abolition  of  the  various  local  and 
special  taxes  (excepting  those  on  realty)  in  favor  of  one  general 
State  percentage  tax  upon  net  premiums,  or  better,  upon  profits, 
and  the  equalization  of  the  tax  as  between  different  kinds  of  in- 
surance companies,  should  be  adopted  throughout  the  country. 
Equally  desirable  is  the  establishment  of  uniformity  of  taxation 
in  the  different  States — the  lack  of  which  gives  rise  to  objection- 
able retaliatory  laws.  But  of  prime  importance  to  the  general  pub- 
lic as  well  as  to  the  policyholder  and  the  insurance  company,  is 
the  reduction  of  the  tax  to  the  point  where  it  will  just  cover  the 
cost  of  the  State  department. 

How  is  this  most  urgent  legislation  to  be  brought  about?  "Will 
the  general  public  bestir  itself?  Not  till  it  is  educated  as  to  the 
true  anti-social  nature  of  the  tax.  Will  the  policyholder  grapple 
with  the  problem?  Not  until  his  eyes  are  opened  to  the  fact  that 
this  tax  is  paid  by  him.  Is  it  then  the  insurance  companies  which 
should  take  the  matter  up  with  the  legislature?  Any  agitation 
on  their  part  would  be  discounted  as  the  natural  outcry  of  the 
victims  of  the  tax. 

The  course  which  I  urge  as  the  most  practicable  and  effective 
is  the  following:  Let  the  insurance  companies  undertake  to  edu- 
cate the  public  to  the  fact  that  the  tax  on  insurance  is  a  thor- 
oughly anti-social  tax;  and  the  policyholder,  to  the  fact  that  the 
tax  is  taken  out  of  his  own  pocket.  Then  the  companies  may 
cease  from  their  labors;  they  will  have  made  their  cause  the  cause 
of  the  public  in  general,  and,  more  particularly,  of  the  policy- 
holder.    The  public  and  the  policyholder  will  do  the  rest. 

The  first  step  in  this  campaign  will  be  for  all  insurance  compa- 
nies of  whatever  class  to  combine  in  an  educational  alliance  for 
this  specific  purpose.  In  so  far  as  the  tax  problem  is  concerned, 
the  interests  of  life,  fire,  marine,  casualty  and  surety  insurance 
companies,  if  not  entirely  identical,  are  so  nearly  identical  that 
they  can  cooperate  harmoniously. 

I  would  suggest  a  small  general  committee  composed  of  repre- 
sentatives from  each  of  the  five  classes  of  business  mentioned  above, 
to  which  shall  be  entrusted  the  duty  of  planning  the  Avays  and 
means  by  which  an  educational  campaign  can  be  best  conducted. 
The  machinery  already  exists  for  selecting  these  representatives — 
each  class  of  insurance  having  its  legislative  or  underwriting 
bureaus.  Such  an  alliance  and  such  a  committee,  having  nothing 
to  do  Avith  the  matter  of  rates,  could  not,  by  any  stretch  of  the 
imagination,  be  considered  as  coming  even  under  the  edge  of  the 
most  stringent  of  the  anti-monopolistic  State  laws ;  and  the  rais- 


WORLD'S  INSURANCE  CONGRESS       287 

ing  of  funds  for  sueh  a  campaign  would  be  a  matter  of  pro  rata 
contribution  according  to  premium  writing. 

This  educational  committee  should  possess  itself  of  every  right 
avenue  of  gaining  the  attention  of  policyholders,  and  the  general 
public,  some  of  which  avenues  I  take  the  liberty  of  suggesting  as 
follows : 

1.  Conventions — at  which  prominent  men  representing  all  phases 
of  political  and  economic  life  shall  be  invited  to  speak. 

2.  Literature — publication  and  wide  distribution  of  addresses 
made  at  these  conventions  and  also  of  statistics  and  graphic  argu- 
ments. 

3.  Pink  slip — a  notice  attached  to  every  policy  contract  stat- 
ing just  what  part  of  the  premium  is  represented  by  the  taxes 
paid  to  the  State  and  local  divisions  thereof;  and  just  how  much 
cheaper  the  premium  would  be  if  these  taxes  were  removed. 

4.  Agents — utilization  of  that  vast  army  of  capable,  industrious 
and  influential  representatives  of  the  insurance  company,  every  one 
of  whom  is  a  voter  and  many  of  whom  are  either  prominent  in 
their  localities  or  on  friendly  terms  with  those  who  are  prominent. 

5.  Social  workers — their  assistance  could  easily  be  obtained  in- 
asmuch as,  urging  universal  insurance  as  one  of  the  preventatives 
of  pauperism,  they  already  regard  any  anti-insurance  measure  as 
anti-social. 

Such  an  educational  alliance,  with  such  ways  and  means,  cannot 
be  formed  too  promptly  for  the  liberation  of  the  insurance  com- 
pany, the  policyholder  and  the  general  public  from  the  toils  of  a 
tax  so  excessive,  so  ill-adjusted  and  so  anti-social. 

The  way  to  resume  specie  payment  was  to  resume:  the  way  to 
begin  our  educational  campaign  is  to  begin. 


STATE  SUPERVISION 

By  T.  W.  Blackburn 
Secretary  and  Counsel,  American  Life  Convention 

Mr.  Chairman,  Ladies  and  Gentlemen :  It  is  a  distinct  pleasure 
to  me  to  be  introduced  to  this  audience  by  my  old  newspaper  con- 
temporary, Mr.  De  Young.  He  looks  up  in  some  surprise,  because 
he  has  evidently  forgotten  that  in  1889  I  was  editor  of  the  Los 
Angeles  Tribune  in  the  City  of  Los  Angeles,  a  city  of  no  mean 
proportions  now,  but  at  that  time  only  about  fifty  thousand. 

I  come  to  you  expressing  my  own  views  on  the  subject  of  State 
Supervision.  My  paper  has  not  been  reviewed  by  the  Executive 
Committee  of  the  American  Life  Convention,  nor  passed  upon  by 
its  membership,  so  I  don't  speak  the  views  of  the  Convention  ex- 
cept where  I  so  state  in  my  paper. 

The  Supreme  Court  of  the  United  States,  having  definitely  and 


288  WORLD'S  INSURANCE  CONGRESS 

finally  determined  that  insurance  is  not  commerce  and  therefore 
not  subject  to  control  by  Congress,  State  supervision  is  a  fixed, 
irrevocable  fact. 

While  there  is  more  or  less  discussion  of  the  desirability  of  Na- 
tional supervision,  and  there  are  pending  before  Congress  two 
bills,  one  in  each  House,  proposing  an  amendment  to  the  Consti- 
tution declaring  insurance  commerce,  the  prospect  of  the  adoption 
of  such  an  amendment  is  so  dim  that  it  is  scarcely  worthy  of  con- 
sideration. 

A  mere  academic  discussion  of  the  relative  merits  of  National 
and  State  supervision  cannot  in  any  wise  change  the  existing  con-, 
dition.  National  supervision,  in  my  opinion,  would  be  undesirable, 
if  practicable  or  possible.  Being  neither  possible  nor  desirable  we 
should  accept  State  supervision,  and  instead  of  attempting  to  get 
rid  of  it  we  should  do  what  we  can  to  make  it  more  serviceable. 

State  supervision  being,  therefore,  a  concrete,  ever-present,  con- 
tinuous condition,  under  which  insurance  companies  must  trans- 
act their  business,  I  will  attempt  to  consider  it  from  the  stand- 
point of  life  insurance. 

Very  naturally  the  topic  resolves  itself  into  two  divisions,  (1) 
supervision  as  it  is  and  (2)  supervision  as  it  should  be. 

State  Supervision  As  It  Is 

The  first  State  in  the  American  Union  to  establish  a  depart- 
ment of  insurance  was  the  State  of  Massachusetts,  which  in  the 
year  1852  reposed  in  a  public  official  supervisory  power  over  in- 
surance companies. 

We  have,  therefore,  an  experience  with  State  supervision  ex- 
tending over  a  period  of  sixty-three  years.  All  the  States  of  the 
American  Union,  the  territories  and  insular  possessions,  as  well  as 
the  District  of  Columbia,  have  provisions  of  law  for  licensing 
insurance  companies  to  do  business  within  their  several  subdivi- 
sions. Some  of  the  States  relegate  the  power  of  supervision  to  a 
board  of  insurance  commissioners.  Others  limit  the  powers  to  a 
single  superintendent  or  commissioner.  All  the  States  supervise 
at  least  to  the  extent  of  determining  under  their  laws  or  the  regu- 
lations of  the  insurance  department  whether  or  not  a  non-resident 
company  may  be  permitted  to  transact  business  within  the  state. 

Generally  speaking  the  insurance  commissioner  or  board  of  in- 
surance commissioners,  as  the  case  may  be,  has  authority  to  make 
examinations  of  domestic  and  foreign  companies,  to  license  insur- 
ance companies  and  for  cause  to  revoke  such  licenses,  to  approve 
and  disapprove  policy  forms  and  more  recently  to  supervise  the 
organization  of  new  insurance  companies. 

From  a  report  made  to  the  American  Life  Convention  by  its 
Committee  on  Departmental  Supervision,  of  which  Mr.  Charles  F. 
Coffin,  the  able  Vice  President  of  the  State  Life  Insurance  Com- 
pany of   Indiana,   was   Chairman,   I   find   that   forty-four  States 


"WORLD'S  INSURANCE  CONGRESS  289 

authorize  the  insurance  commissioner  to  examine  foreign  compa- 
nies doing  business  in  their  several  States  whenever  they  wish  and 
as  often  as  they  please.  Twenty-three  States  require  the  insur- 
ance departments  to  examine  all  companies  periodically,  once  in 
from  three  to  five  years.  Eighteen  States  authorize  the  examina- 
tion of  insurance  companies  at  the  request  of  from  five  to  ten  per^ 
sons  having  certain  financial  interests  therein.  Forty-seven  States 
confer  general  powers  on  insurance  commissioners  to  revoke  li- 
censes. In  twenty-one  States  the  commissioners  of  insurance  are 
authorized  by  law  to  approve  policy  forms  and  to  refuse  authority 
to  issue  any  policy  forms  which  in  the  opinion  of  the  commis- 
sioners do  not  comply  with  the  law.  Within  the  past  five  years 
several  States  have  enlarged  the  powers  of  their  several  commis- 
sioners and  specifically  authorize  the  commissioner  to  make  rules 
and  regulations  governing  the  conduct  of  agents  and  giving  dis- 
cretion to  the  commissioner  to  grant  or  refuse  individual  licenses 
to  agents  as  in  his  opinion  may  seem  just  and  proper.  Many  of 
the  States  gi-ant  to  the  commissioner  the  absolute  authority,  with- 
out appeal,  to  revoke  the  license  of  any  agent  or  the  license  of 
any  company  for  an  offense  which  in  the  opinion  of  the  supei*vis- 
ing  official  warrants  such  drastic  action. 

In  very  few  of  the  States  is  there  any  provision  of  law  which  will 
enable  companies  refused  admission  to  compel  the  insurance  com- 
missioner by  mandamus  to  issue  a  license.  The  courts  in  several  of 
the  States  "have  gone  very  far  in  holding  that  the  acts  of  an  in- 
surance commissioner  are  discretionary  and  when  he  has  acted, 
the  court  has  no  authority  to  review  or  revise  his  proceedings. 

Notwithstanding  the  unlimited  powers  thus  vested  in  the  com- 
missioners of  insurance  of  the  United  States,  in  general  it  is  to 
the  credit  of  State  supervision  that  in  comparatively  few  in- 
stances are  these  arbitrary  powers  exercised  by  the  commissioners 
unreasonably  or  in  such  manner  as  to  work  unnecessary  hardship 
to  any  company. 

Companies  suffer  under  the  diversity  of  revenue  laws  and  the 
the  statutory  fees  are  in  many  States  altogether  too  high.  The 
States,  however,  are  not  much  more  exacting  than  the  National 
government  would  certainly  become  if  the  taxing  power  were 
taken  from  the  State  and  were  lodged  with  Congress. 

The  most  exasperating  feature  of  State  supervision  is  the  exer- 
cise of  authority  to  make  examinations  at  will.  In  days  fortu- 
nately long  passed,  it  was  customary  for  a  newly  appointed  com- 
missioner of  insurance  to  proceed  forthwith  to  make  examinations 
to  suit  his  whims.  In  some  cases  it  was  openly  avowed  and  prac- 
tically understood  that  the  commissioner  was  appointed  tli rough 
political  influences  with  the  express  intention  that  he  should  have 
the  perquisites  of  the  office,  which  perquisites  consisted  mainly  of 
the  fees  for  examinations.  It  is  not  many  years  since  a  commis- 
sioner made  a  trip  from  coast  to  coast  examining  every  company 
on  his  route  and  charging  each  of  the  companies  with  mileage  and 


290       WORLD'S  INSURANCE  CONGRESS 

per  diem  whether  an  actual  examination  was  made  by  the  commis- 
sioner or  his  assistant  or  not.  He  has  long  since  retired  to  private 
life. 

Very  recently,  a  commissioner  of  one  of  the  States  engaged  a 
well-known  actuary  residing  on  the  opposite  side  of  the  continent 
to  make  examinations  of  domestic  companies  within  his  own  jur- 
isdiction. That  eminent  actuary  carried  with  him  t\vo  assistants. 
The  unfortunate  company  which  was  being  supervised  was  taxed 
$50  per  day  and  expenses  for  the  imported  actuary  and  $15  a 
day  and  expenses  for  each  of  his  two  assistants,  a  charge  ex- 
ceeding $100  per  day  for  a  period  ranging  from  ten  days  to  thirty- 
six  days.  Under  the  laws  of  the  State  therein  mentioned  the  com- 
missioner collects  the  estimated  cost  of  examinations  in  advance. 
He  demanded  $1,500  per  company  under  this  law  and  collected 
same. 

It  is  fair  to  the  commissioners  of  America  to  say  at  this  point 
that  it  is  no  part  of  their  purpose  or  plan  that  a  proceeding  of 
this  sort  shall  occur.  An  inexperienced  commissioner,  a  wide-awake 
actuary  and  a  desire  to  shine  in  the  spotlight  was  the  combination 
which  succeeded  in  developing  this  almost  scandalous  situation. 

Several  years  ago  the  commissioners  appointed  a  Committee  on 
Examinations,  placing  at  the  head  of  it  one  of  the  oldest  com- 
missioners in  the  service,  and  since  the  appointment  of  his  com- 
mittee very  little  complaint  has  been  heard  from  the  companies 
as  to  unnecessary,  unreasonable  and  exorbitant  examination 
charges.    I  recall  but  two  instances  in  recent  years. 

Another  annoying  feature  of  the  system  of  State  supervision, 
as  now  in  force,  grows  out  of  the  authority  quite  recently  given 
to  commissioners  to  determine  whether  or  not  the  forms  of  poli- 
cies prepared  by  companies  may  or  may  not  be  written  within  the 
jurisdiction  of  a  given  insurance  commissioner.  I  am  of  the  opin- 
ion that  the  forms  of  policies  should  be  supervised  by  the  State 
officials,  and  that  certain  forms  of  policies  devised  by  companies  in 
the  United  States  are  properly  the  subject  of  criticism,  but  the 
law  generally  gives  to  the  commissioner  absolute  authority,  with- 
out appeal  from  his  decision,  to  determine  whether  or  not  a  form  of 
of  policy  may  or  may  not  be  used  in  the  State. 

It  is  a  far  cry  from  the  crude  methods  prevailing  at  the  time 
the  great  older  companies  of  the  United  States  were  organized  to 
the  present  refinements  of  supervision  provided  for  by  the  laws  of 
the  several  States.  It  is  to  the  credit  of  the  life  insurance  com- 
panies of  the  United  States  that  they  builded  wisely,  safely  and 
honestly  before  the  doctrine  of  direct,  arbitrary  and  scientific 
supervision  became  the  policy  of  the  land. 

This  leads  me  to  say  that  State  supervision  is  successful,  not 
because  of  the  wide  discretion  committed  to  the  superv'isors.  but 
because  the  managements  of  life  insurance  companies  of  this  coun- 
try have  cooperated  with  the  supervising  officials  to  place  life  in- 


WORLD'S  INSURANCE  CONGRESS  291 

surance  upon  the  highest  plane  of  fair  dealing,  high-minded  ser- 
vice and  honest  treatment  of  policyholders. 

Most  of  the  Avise  laws  enacted  for  the  betterment  of  life  insur- 
ance originated  in  the  offices  of  the  companies.  Life  insurance  is 
transacted  continuously  under  the  searchlight  of  a  relentless  pub- 
licity. Supervision  has  no  terrors  to  the  companies,  save  as  to 
the  expense  and  annoyance  of  frequent  examinations. 

To  the  insurance  commissioners  of  the  United  States  the  most 
tremendous  financial  interests  of  America  have  been  committed. 
Under  State  supervision  these  institutions  have  grown  great  in 
their  power  for  good.  To  their  credit  and  to  the  credit  of  the 
commissioners  it  may  be  said  that  few  are  the  instances  of  mis- 
conduct in  the  life  insurance  field,  whether  on  the  part  of  the 
company  managements  or  the  insurance  commissioners. 

Without  any  law  providing  for  it,  but  by  common  consent,  the 
insurance  commissioners  of  the  United  States  have  agreed  upon 
and  put  into  effect  a  uniform  blank  under  the  terms  of  which  all 
companies  make  their  reports  to  all  commissioners  covering  the 
same  items.  As  a  result  the  methods  of  calculating  reserves,  assets, 
liabilities,  credits  and  charges  have  become  practically  uniform 
throughout  the  country. 

Under  the  handicap  of  the  great  lack  of  uniformity  in  our  State 
insurance  laws,  under  the  handicap  of  politicians  controlling  the 
appointments  and  filling  the  offices  of  the  insurance  departments, 
and  under  the  handicap  of  unwise  and  crude  legislation  in  the 
several  States,  the  supervisors  of  insurance,  appointed  or  elected 
in  the  several  States,  have  made  the  system  of  State  supervision 
generally  wholesome,  efficient  and  helpful  to  all  interested. 

What  Should  State  Supervision  Be  ? 

The  uniform  blank  is  a  forerunner  of  uniform  departmental 
regulation.  It  would  be  safe  for  the  States,  within  certain  limi- 
tations, to  give  to  the  supervising  officials  the  right  and  power 
to  establish  and  enforce  general  regulations  governing  life  insur- 
ance companies.  If  this  power  were  conceded  to  the  commissioners 
of  all  the  States,  they  themselves  would  unite  and  revise  and 
adopt  regulations  fair  to  the  people,  fair  to  the  companies,  fair 
to  the  agents  and  fair  to  all  concerned.  Absolutely  uniform  de- 
partmental rulings  are  impossible  with  conflicting  laws,  but  there 
are  many  regulations  which  could  be  adopted  by  all  departments. 

Great  advancement  has  been  made  in  the  matter  of  uniformity 
of  laws.  Sometimes  we  feel  that  uniform  laws  in  forty-eight 
States,  governing  and  affecting  life  insurance,  or  any  other  form 
of  indemnity,  is  an  iridescent  dream.  Nevertheless,  within  the 
past  ten  years  the  provisions  for  valuation,  for  annual  reports  to 
the  departments,  for  service  of  process  against  non-resident  com- 
panies on  the  commissioner,  for  many  standard  policy  provisions, 
prohibiting  other  provisions,   and  prohibiting  political  contribu- 


292       WORLD'S  INSURANCE  CONGRESS 

tons  have  become  more  or  less  common  to  all  the  states  of  the 
Union.  Likewise,  slowly  but  surely,  regulations  prohibiting  mis- 
representation, twisting  and  rebating,  are  tinding  their  way  into 
the  statutes. 

I  am  not  favorable  to  general  codes  of  insurance  and  yet  more 
than  a  dozen  States  have  adopted  codes,  largely  similar  as  to 
essential  details.  I  would  provide  separate  codes  for  the  several 
distinct  forms  of  insurance  and  regard  it  as  essential  that  life  in- 
surance shall  be  governed  by  laws  drawn  especially  for  the  control 
of  this  form  of  indemnity.  I  favor  separate  codes  for  life  in- 
surance because  there  is  no  other  form  of  commercial  contract 
analogous  to  the  life  insurance  contract.  It  is  in  a  class  by  itself. 
Legislation  should  be  conceived,  formulated  and  enforced,  so  far 
as  life  insurance  is  concerned,  from  a  life  insurance  standpoint. 
Regulations  which  properly  apply  to  fire,  accident,  casualty  and 
other  lines  of  insurance  are  wholly  out  of  place  when  applied  to 
life  insurance.  For  example,  life  insurance  salesmen  should  not 
be  limited  in  their  territory  except  by  contract  with  the  company 
employing  them.  A  life  insurance  salesman  can  perform  his  ser- 
vice for  his  company  and  for  his  patrons  quite  as  well  in  one  city, 
county  or  community  as  another.  This  is  not  true  of  fire  insur- 
ance agents,  or  of  agents  of  companies  engaged  in  other  lines  of 
business  where  the  agent  himself  executed  and  delivers  the  insur- 
ance contracts. 

In  several  States  all  agents  are  required  to  be  residents,  a  pro- 
vision of  law  that  does  no  good  to  anybody  and  hampers  the  effi- 
ciency of  the  field  force  of  a  life  insurance  company.  It  should 
be  amended  to  except  life  insurance  agents. 

I  mention  this  as  one  of  the  many  provisions  which  will  natur- 
ally find  their  way  into  a  general  code  but  which  would  not  be 
considered  in  a  separate  and  distinct  code  governing  life  insurance 
itself. 

Life  insurance  companies  have  not  sought  to  initiate  legislation 
during  the  past  few  years.  The  tendency  of  the  times  has  been  un- 
favorable to  fair  consideration  of  proper  legislation.  The  life  in- 
surance companies  have  therefore  stood  ready  to  approve  good 
measures  proposed  and  to  oppose  unwise  statutory  regulations. 
Nevertheless  all  life  insurance  organizations  are  favorable  to  uni- 
form laws.  The  American  Life  Convention,  of  which  I  have  the 
honor  to  be  Secretary  and  Counsel,  and  the  Association  of  Life 
Insurance  Presidents,  within  the  last  two  years,  by  cooperating  and 
interchanging  views,  have  prepared  and  adopted  a  system  of  stan- 
dard code  provisions  relating  to  the  business  of  life  insurance. 
This  code  could  well  be  adopted  by  all  the  States  in  the  American 
Union.  It  is  fair,  complete  and  safe.  It  has  taken  from  the  stat- 
utes of  many  of  the  States  laws  now  on  the  statute  books.  It  has 
proposed  complete  revision  of  comparatively  few  of  the  provisions 
now  very  generally  included  in  the  insurance  codes  of  the  several 
States.     It  covers  the  entire  field   and  its  provisions  have  been 


WORLD'S  INSURANCE  CONGRESS  293 

drawn  with  an  eye  single  to  the  best  interests  of  the  business  itself, 
which  invariably  means  the  best  interests  of  the  policyholders. 

It  must  be  understood  that  life  insurance,  as  a  whole,  is  a  great 
organization  of  cooperation  among  the  policyholders  of  all  the 
companies.  It  is  not  a  selfish,  commercial  enterprise  in  which  the 
profits  of  the  individual  organizations  are  the  paramount  subject 
for  consideration.  Life  insurance  succeeds  solely  because  it  is  a 
business  where  each  contributes  to  the  good  of  all  and  all  unite 
for  the  good  of  each.  Therefore,  it  would  seem  that  uniformity 
of  State  laws  can  very  easily  be  brought  about  when  legislatures 
come  to  understand  that  life  insurance  legislation  proposed  and 
advocated  by  the  united  organizations  represented  in  tbe  American 
Life  Convention,  the  Association  of  Life  Insurance  Presidents,  the 
National  Association  of  Life  Underwriters  and  the  National  Con- 
vention of  Insurance  Commissioners,  cannot  and  will  not  be  other- 
wise than  fair  to  all  concerned. 

One  State,  the  State  of  Washington,  has  incorporated  into  its 
statutes  a  provision  that  all  examinations  of  life  insurance  com- 
panies shall  be  at  the  expense  of  the  State,  excepting  the  single 
examination  for  admission  to  do  business  within  the  State. 

Section  15  of  the  standard  code  provisions,  to  which  reference 
has  already  been  made,  provides  as  follows: 

"The  expense  of  every  examination  or  other  investigation  of 
the  affairs  of  any  life  insurance  company,  made  pursuant  to  the 
authority  conferred  by  the  provisions  of  this  act  upon  its  applica- 
tion for  license  to  transact  business  in  this  State,  and  the  expenses 
of  every  examination  or  other  investigation  of  the  affairs  of  any 
life  insurance  company  doing  business  in  this  State,  made  pursu- 
ant to  the  authority  conferred  by  the  provisions  of  this  act  which 
shall  disclose  a  condition  of  insolvency  in  the  affairs  of  the  com- 
pany, Br  cause  for  the  revocation  of  its  license,  shall  be  borne  by 
the  company  examined  and  paid  by  it  to  the  Insurance  Commis- 
sioner upon  itemized  bills  of  expenses  presented  by  him.  No  insur- 
ance company  nor  any  officer  or  director  thereof  shall,  either 
directly  or  indirectly,  pay  by  way  of  gift,  credit,  or  otherwise  any 
sum  of  money  or  other  valuable  thing  to  the  Commissioner  or  any 
clerk  or  employee  of  the  Insurance  Department  or  any  examiner 
for  extra  service  or  for  the  purpose  of  legislation,  or  by  way  of  a 
loan  or  on  any  other  pretense  whatsoever." 

The  fees  paid  into  the  departments  of  the  various  States  in  the 
Union  constitute  a  heavy  item  of  revenue.  The  excess  of  pay- 
ments, beyond  necessary  and  proper  expenses  of  every  insurance 
department  in  the  United  States,  aside  from  examination  fees, 
provide  abundant  funds  for  payment  of  all  expenses  of  examining 
companies."^  Once  the  policy  of  having  expenses  of  examinations 
paid  by  the  States  from  their  insurance  funds  is  adopted,  the 
temptation  of  public  officials  to  make  examinations  for  the  purpose 
of  increasing  the  revenue  of  their  departments  or  for  the  purpose 


294       WORLD'S  INSURANCE  CONGRESS 

of  providing  profitable  employment  for  political  appointees,  is  re- 
moved. The  chance  of  scandal  is  reduced  to  the  minimum  and  the 
usefulness  to  the  community  of  such  examinations  is  greatly  in- 
creased. The  temptation  on  the  part  of  the  companies  to  pay  over- 
charges to  avoid  contention  or  curry  favors  is  obviated.  When  the 
departments  are  placed  upon  a  civil  service  basis  throughout  the 
country  and  men  are  appointed  and  retained  on  their  merits,  the 
system  of  examinations  will  be  simplified,  and  the  enormous  ex- 
pense to  the  companies,  which  means  to  the  policyholders,  of  fre- 
quent and  unnecessary  examinations,  will  be  removed. 

The  development  of  the  department  of  insurance  as  a  distinct 
entity  in  the  system  of  State  government  has  been  a  slow  evolution. 
Originally  the  insurance  commissioner,  elected  or  appointed  for 
political  purposes,  had  no  conception  of  the  importance  of  the 
duties  incumbent  upon  the  office.  Gradually,  as  departments  in 
some  of  the  older  States  have  been  standardized  and  have  been 
brought  under  civil  service  regulations,  the  value  and  importance 
of  the  insurance  department  have  grown.  In  other  days  an  ex- 
aminer was  a  man  picked  up  on  the  street  as  a  hungry  politician 
who  could  make  figures  and  write  some  form  of  report.  In  these 
later  days  the  examiner  generally  knows  something  of  the  subject 
of  insurance,  and  if  he  does  not  the  department  has  an  actuary 
who  is  a  skilled,  scientific  insurance  mathematician. 

Every  department  should  have  a  trained  actuary  who  devotes 
his  entire  time  to  the  business  of  his  department  or  the  depart- 
ment should  have  authority  to  engage  a  trained  consulting  actuary 
who  is  entirely  independent  of  any  company  which  is  likely  ever 
to  be  examined  or  brought  into  competition  with  other  companies 
in  the  State  to  which  such  consulting  actuary  is  assigned  for  ser- 
vices. In  this  connection,  permit  me  to  recommend  to  the  consider- 
ation of  this  Congress  and  the  insurance  world  generally  the  fol- 
lowing resolution,  carefully  considered,  and  in  my  opinion  wisely 
adopted  as  a  principle  to  govern  the  examination  of  companies 
throughout  the  Union,  found  in  the  proceedings  of  the  annual 
meeting  of  the  American  Life  Convention  in  Chicago  in  1913 : 

"Whereas,  The  members  of  the  American  Life  Convention  rec- 
ognize the  protection  afforded  policyholders  through  the  provision 
of  the  insurance  laws  of  the  various  States,  giving  the  supervising 
officials  authority  to  make  examination  of  the  affairs  of  life  in- 
surance companies,  and  is  in  hearty  accord  with  the  spirit  of 
such  laws  in  ro()uiring  full,  complete,  fair  and  impartial  exam- 
ination of  their  affairs  by  such  supervising  officials  and  experts 
employed  by  them  to  the  end  tliat  ])()lieyholders  and  the  public 
generally  may  be  informed  as  to  the  financial  condition  of  such 
companies  and  their  general  methods  and  practices,  and 

"Whereas,  The  American  Life  Convention  is  firmly  convinced 
that  it  is  against  the  best  interests  not  only  of  the  companies  but 
also  of  the  policyholders  and  the  public  to  have  departmental  ex- 


WORLD'S  INSURANCE  CONGRESS  295 

aminations  made  by  actuaries  employed  by  a  life  insurance  com- 
pany or  companies,  now  therefore  be  it 

"Resolved,  That  it  is  the  sense  of  this  Convention  that  no 
member  herein  should,  without  vigorous  protest,  permit  any  offi- 
cial examination  of  its  affairs  to  be  made  by  any  actuary,  either 
in  charge  of  such  examination  or  in  consultation  with  those  in 
charge,  unless  the  entire  time  of  such  actuary  is  devoted  to  the 
work  of  insurance  supervising  officials. ' ' 

The  legislation  throughout  the  country  intended  to  limit  the 
efficiency  and  personal  liberty  of  agents  of  insurance  companies 
proceeds,  I  fear,  upon  a  wrong  theory.  With  the  purpose  of  the 
insurance  commissioners  to  take  over  to  themselves  complete  au- 
thority to  determine  the  qualifications  of  agents  and  absolutely 
control  their  appointment  and  right  to  continue  in  the  service, 
I  am  not  in  sympathy.  From  extended  observation  I  have  con- 
cluded that  the  average  salesman  of  the  average  life  insurance 
company  is  not  only  more  capable  as  a  salesman  than  the  average 
salesman  in  any  other  occupation,  but  equally  as  honest.  There  is 
no  more  reason  for  providing  drastic  regulations  to  govern  the 
appointment  and  control  of  agents  of  life  insurance  companies 
than  there  is  to  govern  and  control  the  salesman  of  the  great  pack- 
ing houses  or  the  great  steel  and  oil  industries  of  this  country. 
There  is  no  more  reason  for  providing  that  a  life  insurance  solicitor 
shall  be  put  in  a  class  by  himself  to  be  especially  supervised  than 
that  the  Interstate  Commerce  Commission  should  supervise  and 
dictate  appointments  of  section  foremen,  conductors,  passenger 
agents,  freight  agents  and  the  like  on  the  railroads. 

The  companies  should  be  held  responsible  for  the  quality  of  their 
agency  force.  The  department  should,  through  the  companies,  dis- 
cipline any  agent  who  is  guilty  of  any  violation  of  the  ethics  or 
the  law,  having  the  right  to  revoke  a  license  for  cause  and  reserv- 
ing to  the  agent  and  the  company  the  right  of  appeal  from  any 
order  of  the  commissioner  affecting  the  right  of  either  agent  or 
company. 

The  annual  statement,  as  provided  for  by  law,  and  consequently 
included  in  the  unifonn  statement  blank,  occasions  some  unneces- 
sary expense  to  the  companies.  For  example,  many  of  the  States 
require  a  statement  of  the  market  value  of  the  securities  on  the 
31st  day  of  December  of  the  year  in  which  the  statement  is  made. 
This  is  an  unfair  method  of  calculating  assets  and  is  gradually 
being  amended  by  the  substitution  of  the  amortization  plan  and 
within  a  few  years  all  states  will  value  securities  by  amortization. 
Many  of  the  States  require  companies  to  file  detailed  lists  of  all 
existing  loans  upon  the  security  of  real  property  and  to  file  with 
the  commissioner,  from  time  to  time,  lists  showing  changes  in 
these  securities.  This  involves  a  tremendous  amount  of  unneces- 
sary labor.  It  is  impossible  for  an  insurance  commissioner  in 
Nevada  to  check  up  or  in  any  wise  inform  himself  upon  the  char- 
acter of  securities  contained  in  the  volume  of  several  hundred 


296       WORLD'S  INSURANCE  CONGRESS 

pages  of  real  estate  securities  which,  under  the  law,  it  becomes 
necessary  for  the  Union  Central  Life  of  Cincinnati  to  hie  in  every 
State  where  it  does  business.  The  mere  expense  of  printing  this 
list  of  securities  is  enormous  and  no  good  purpose  is  served  by  pro- 
viding for  48  copies  of  the  list  to  be  filed  in  48  departments.  The 
laws  should  be  changed  so  that  the  list  shall  be  prepared  and  filed 
with  the  department  of  the  domiciliary  State  of  the  company,  where 
it  is  accessible  to  all  parties  interested  and  where  it  must  be  checked 
over  by  the  local  department.  All  other  departments  should  rely 
upon  the  domiciliary  commissioner,  unless  for  good  reason  their 
own  examiners  are  sent  to  the  home  office  of  the  company  for  the 
express  purpose  of  checking  over  such  list  of  securities. 

Some  of  the  laws  require  a  showing  of  the  largest  balances  car- 
ried in  banks  during  any  single  day  of  the  year  for  which  report 
is  being  made.  This  is  a  provision  of  law  which  is  misleading  and 
accomplishes  no  good  purpose.  The  largest  average  balance  for 
any  month  in  the  year  would  more  completely  accomplish  the  pur- 
pose of  such  a  law. 

It  happens  frequently  with  life  insurance  companies,  as  with 
other  businesses,  that  on  some  particular  day,  when  a  large  loan 
is  paid  in  or  by  reason  of  some  other  circumstance,  the  total  amount 
on  deposit  in  a  local  bank  is  two,  three  or  ten  times  what  it  may 
be  on  any  other  day  of  the  same  month.  The  purpose  of  the  law 
is  to  prevent  companies  from  carrying  larger  balances  with  favored 
banks  than  is  fair  to  the  policyholders,  but  this  provision  does  not 
in  any  wise  accomplish  the  purpose  because  the  total  amount  of 
such  deposit  on  a  particular  day  is  not  under  the  control  of  the 
company  at  all,  but  depends  upon  circumstances  wholly  beyond  the 
control  of  the  management. 

The  difficulty  in  bringing  about  unifonnity  of  laws  in  the  sev- 
eral States  may  be  best  understood  from  the  following  statement 
as  to  the  number  of  life  insurance  bills  introduced  in  the  several 
legislatures  during  the  recent  legislative  season:  Florida,  49; 
California,  48;  Minnesota,  37;  Wisconsin,  33;  Pennsylvania,  21; 
North  Dakota,  20 ;  Nebraska,  15 ;  Illinois,  ^Missouri  and  Texas,  each 
14;  Kansas,  Oklahoma  and  Oregon,  each  13;  Idaho,  11;  Michigan, 
Ohio  and  Washington,  10  each ;  New  York  and  New  England,  29. 

Tetany  of  the  bills  proposed  in  the  several  States  above  named 
were  wholly  without  merit.  Others  might  have  been  adopted  with- 
out injury  to  any  interests  connected  with  life  insurance.  I  men- 
tion the  number  of  bills  in  detail  to  illustrate  the  importance  of 
some  method  of  securing  uniformity  in  the  legislation  throughout 
the  country,  and  believe  that  if  the  State  legislatures  could  be 
brought,  through  the  education  of  public  sentiment,  to  the  idea 
that  legislation  affecting  insurance,  and  particularly  life  insur- 
ance, should  not  be  adopted  unless  recommended  by  the  commis- 
.sioner  of  the  State  in  which  offered,  we  would  come  nearer  secur- 
ing uniform  laws  governing  life  insurance  than  by  any  other  plan 
so  far  suggested.     I  have  observed  that  when  the  National  Con- 


WORLD'S  INSURANCE  CONGRESS  297 

vention  of  Insurauee  Commissioners  agrees  to  recommend  legisla- 
tion the  commissioners  of  the  departments  generally  stand  by  such 
recommendation  and  favor  the  adoption  of  provisions  so  recom- 
mended. It  is  a  fact,  too,  that  unwise  laws  are  seldom  enacted  in 
the  States  where  the  conuuissioner  has  long  been  in  office. 

I  go  no  further  into  detail  on  this  question  of  uniformity  of 
legislation.  I  regard  it  as  vital  to  State  supervision  and  vital  to 
the  companies  that  a  plan  be  devised  which  shall  unite  the  in- 
surance commissioners  with  the  insurance  companies  in  system- 
atic, continuous,  effective  effort  toward  eliminating  contradictory 
statutes  and  bringing  the  State  laws  into  such  harmony  as  shall 
effectually  remove  the  most  serious  handicap  of  State  supervision. 

Every  man  in  America  will  agree  with  me  that  the  insurance 
departments  of  the  States  should  be  removed  from  the  pernicious 
political  atmosphere  in  which  the  business  of  the  departments  must 
now  be  conducted.  It  will  not  be  long  until  the  people  themselves 
will  demand  that  the  office  of  insurance  commissioner  shall  be  non- 
political.  Insurance  companies  can  largely  prevent  the  appoint- 
ment of  mere  politicians  to  these  important  positions  by  dignified 
protest  and  friendly  suggestion.  It  will  not  be  so  material  that 
the  head  of  the  office  shall  be  granted  a  more  permanent  tenure, 
if  departments  are  organized  on  the  civil  service  basis  and  the 
actual  examiners  and  detail  employees  are  permanently  retained. 

I  feel  certain  that  an  area  of  cooperation  has  arrived;  that  the 
relation  existing  between  the  supervising  officials  of  the  State  de- 
partments and  the  companies  has  never  been  so  friendly ;  that  the 
companies  themselves  are  no  longer  devoting  themselves  to  cut- 
throat competition  and  that  by  diffusion  among  the  people  of  in- 
formation regarding  insurance  matters  Ave  shall  within  the  next 
ten  years  see  great  progress  made  toward  uniform  laws  and  de- 
partmental rulings. 

The  American  Life  Convention  numbers  ninety-seven  members 
who  are  domiciled  in  thirty-three  western,  central  and  southern 
States.  Their  officials  are  in  close  touch  with  their  several  home 
departments.  A  complete  understanding  between  the  companies 
of  the  East  and  those  of  the  West  would  eliminate  much  friction. 
The  home  companies.  East  and  West,  working  through  their  home 
departments,  can  do  much  to  bring  about  uniform  laws  and  rul- 
ings. Cooperating  as  is  possible  with  the  great  fraternal  societies 
to  the  extent  of  recognizing  those  institutions  and  not  antagoniz- 
ing them,  the  legal  reserve  companies  will  find  little  difficulty  in 
enacting  and  amending  laws  applying  solely  to  legal  reserve  life 
insurance.  The  large  eastern  companies,  influential  also  in  their 
home  States,  can  afford  to  relax  upon  some  pet  methods  of  valu- 
ation and  open  the  doors  to  their  preliminary  term  brethren  of 
the  West  and  South. 

The  outlook  is  not  at  all  hopeless.  Entire  uniformity  is  im- 
practicable, but  uniformity  upon  the  essentials  is  enough.  It  is 
well  worth  while  for  this  Congress  to  accept  the  situation  as  it 


298  WORLD'S  INSURANCE  CONGRESS 

exists;  to  direct  its  efforts  to  correct  conditions  gradually  and 
refrain  absolutely  from  recommending  or  attempting  anything 
revolutionar}'. 

Let  us  then  abandon  academic  controversy,  get  down  to  busi- 
ness upon  a  business  basis,  accept  things  as  they  are  and  pro- 
ceed through  our  established  organizations  harmoniously  working 
together  each  for  the  good  of  all  and  all  for  the  good  of  each. 


TAXATION  FOR  REVENUE  * 

Penalizing  the  Preventimi  of  Poverty 

By  Edward  A.  Woods 

President,  National  Association  of  Life  Underwriters 

Taxing  the  property  held  by  life  insurance  companies,  which 
should  pay  the  same  tax  any  other  property  does,  is  not  intended 
to  be  criticized.  It  is  the  additional  tax  imposed  for  doing  busi- 
ness, generally  a  percentage  on  gross  income,  which  directly  in- 
creases the  cost  to  policyholders,  that  is  criticized. 

It  is  now  the  settled  policy  of  all  peoples,  in  proportion  as  they 
are  civilized  and  progressive,  to  care  for  dependent  members  of 
society.  Only  nations  beyond  the  pale  of  civilization  may  to-day 
suffer  the  disgrace  of  indifference  to  their  sick  and  aged,  widows 
and  orphans,  insane  and  cripples.  Modern  society  will  no  more 
suffer  their  uncared-for  presence  than  it  would  the  leper  or  maniac. 
The  day  has  forever  gone  when  the  beggar  may  be  thrust  outside 
the  gates  to  starve,  or  the  helpless  maniac  or  even  the  criminal 
may  be  left  to  perish.  The  unemployed  are  now  subjects  of  social 
and  legislative  attention.  Beggary  is  a  public  offense,  implying 
a  social  obligation  to  avert.  Illiteracy  and  disease,  the  result  as 
well  as  cause  of  poverty,  are  sought  to  be  banished  by  large  State 
expenditures  and  legislation  seeking  to  compel  education  and 
health.  Other  causes  and  consequences  of,  and  remedies  for,  pov- 
erty are  subjects  of  increasing  concern  and  growing  legislation. 

All  Wealth  Worthless  without  Human  Life 

It  is  at  least  being  recognized  that  life  is  the  most  valuable  of 
all  the  assets  of  a  nation.  IMaterial  resources  are  valuable  only 
because  of  human  life  and  in  proportion  to  the  number  and  value 
of  human  lives.  All  of  the  resources  of  an  uninhabited  island,  or 
even  savage,  however  great  in  mineral,  vegetable  and  other  wealth, 
without  human  life  arc  worthless.  We  had,  the  day  before  Co- 
lum])us  landed,  even  more  physical  assets  on  this  continent  that 
we  have  to-day,  because  much  has  since  been  consumed.     But  in 

*  Not  read. 


WORLD'S  INSURANCE  CONGRESS  299 

proportion  as  destructive  and  unproductive  savages  were  replaced 
by  intelligent,  valuable  lives  did  our  real  national  wealth  grow. 

Valueless  Lives  a  Ll\bility 

The  chief  total  wealth  of  any  nation  is  the  sum  of  lives  of  those 
of  its  people  who  are  valuable  to  society.  But  because  we  no 
longer  cast  away,  but  care  for  and  even  rescue,  waste  lives,  we 
must  deduct  from  this  total  of  valuable  lives  those  dependents 
who  are  a  burden  upon  the  rest.  As  the  whole  wealth  of  a  nation 
is  equal  to  the  sum  of  all  its  parts,  it  is  increased  by  lessening 
the  number  of  dependents;  still  more  by  turning  them  into  lives 
of  value,  by  prolonging  the  lives  that  are  valuable  and  converting 
useless  lives  into  healthy,  intelligent  and  moral  ones.  Obviously 
a  live,  healthy,  intelligent  and  moral  man  is  worth  more  than  a 
dead,  sickly,  ignorant  or  criminal  one. 

If  wasted  human  lives  can  be  turned  into  valuable  ones,  if  all 
can  be  converted  into  active  civil  soldiers,  unhampered  by  the  sick, 
wounded  and  prisoners,  and  their  care,  total  values  will  increase. 

Cheaper  to  Prevent  Dependence  Than  to  Pay  For  It 

These  truisms  seem  trite  and  yet  are  facts  of  comparatively  re- 
cent recognition.  From  them  follow  the  interest  and  duty  of  the 
State  itself,  at  its  own  cost,  to  discourage  and  prevent  dependency, 
and,  better  still,  to  aid  and  encourage  any  influence  or  institution 
helping  to  accomplish  this.  It  is  obviously  cheaper  and  better  to 
induce  and  aid  another  to  do  at  his  expense  what  we  would  other- 
wise have  to  do  wholly  or  partly  at  our  own.  And  it  is  far  better, 
as  well  as  cheaper,  and  more  the  American  spirit,  to  encourage  a 
people  to  do  voluntarily  for  themselves  what  the  Nation  would 
otherwise  do  for  them,  and  thus  encourage  others. 

Possibly  no  other  nation  is  doing  as  much  for  its  dependents. 
And  yet  many  other  nations  are  doing  more  to  encourage  their 
people  in  methods  of  self-help.  This  is  but  another  illustration 
of  the  prodigality  and  wastefulness  of  the  American  people,  spend- 
ing more  money  to  remedy  an  evil  than  it  would  cost  to  avert  it. 

The  National  Cost  op  Dependency 

What  the  annual  savings  of  the  Nation  Avould  be,  were  depend- 
ency eliminated,  is  of  course  to  discuss  a  millennial  condition.  But 
just  as  it  pays  an  individual  to  take  stock  of  his  assets  and  to 
measure  frankly  his  losses,  so  it  is  worth  while  to  see  just  what 
the  maximum  amount  is  that  the  Nation  theoretically  could  save 
were  dependency  eliminated,  and  try  to  accomplish  as  much  of 
this  ideal  maximum  as  we  can. 

It  is  estimated  that  the  United  States  is  paying  for  dependency 
in  various  ways,  organized  channels  public  and  private,  between 
$350,000,000  and  $400,000,000.     This  does  not  include  the  $172,- 


300       WORLD'S  INSURANCE  CONGRESS 

000,000  paid  in  Government  pensions;  it  probably  does  not  in- 
clude the  increasing  amount  of  State  pensions  paid  to  widows, 
mothers,  public  employees  and  others;  most  of  all,  it  does  not  in- 
clude an  amount,  probably  largely  in  excess  of  these  figures,  being 
contributed  directly  and  indirectly  by  individuals  themselves  for 
the  care  of  dependents.  There  are,  indeed,  few  persons  of  any 
means  whatever  who  are  not,  in  addition  to  taxes  and  personal  con- 
tributions to  charities,  in  some  way  helping  to  care  for  some  de- 
pendent kindred,  neighbor  or  friend ;  and  it  is  highly  probable 
that  the  sura  of  these  contributions  would  largely  exceed  the  sums 
recorded  by  the  Government  and  by  organized  charities.  The  an- 
nual saving  of  a  nation,  could  all  this  contribution  for  the  support 
of  dependents  be  avoided,  would  be  a  figure  that  could  be  written 
down  but  not  comprehended. 

Indirect  Cost  of  Dependency 

In  addition  to  this,  could  the  indirect  results  of  dependency  be 
averted ;  could  the  1,000,000  persons  in  our  institutions  for  de- 
pendents— in  which  over  $1,500,000,000  is  invested — be  made 
income-producing  instead  of  an  expense,  we  could  change  so  much 
from  liabilities  to  assets.  Could  the  10,000,000  persons  who  Rob- 
ert Hunted  says  are  living  on  the  poverty  line — and  he  says  the 
figure  may  be  nearer  15,000,000 — be  raised  to  a  condition  where 
every  emergency  does  not  require  outside  help ;  could  the  results 
of  dependency,  poverty,  lack  of  education,  child  labor,  woman 
labor,  unsanitary  surroundings,  under-efficiency  due  to  a  physical, 
moral  and  intellectual  sub-normality;  be  remedied  if,  in  fact,  de- 
pendency from  infancy  to  old  age  could  be  banished  from  our  land, 
who  can  estimate  what  could  be  added  annually  not  only  to  our 
financial  wealth  but  to  the  physical,  intellectual  and  moral  worth, 
happiness,  and  prosperity  of  its  people?  Contrast,  for  example, 
two  communities:  one  where  there  are  no  dependents — where  all 
are  helping  and  none  hindering,  the  other  where  the  dependent 
population  is  great,  and  who  would  not  urge  the  encouragement 
in  every  possible  way  of  conditions  which  would  make  for  the  for- 
mer instead  of  for  the  latter? 

Life  Insurance  a  Chief  Preventive  op  Dependency 

The  peculiarly  American  institution  of  life  insurance  is  the 
greatest  movement  for  organized  thrift  and  for  the  averting  of 
dependency  that  we  have  to-day  or  that  has  ever  been  known  in 
the  world.  Its  some  25,000,000  members  are  systematically  and 
regularly  contributing  from  their  funds  to  avert  the  conditions  of 
which  we  have  spoken.  It  not  only  interests  more  people  than  all 
the  other  forms  of  thrift  combined  but  upon  a  more  comprehensive 
and  systematic  plan,  not  for  sporadic  but  for  permanent  savings. 


WORLD'S  INSURANCE  CONGRESS  301 

Insured  Persons  the  Provident  and  Thrifty 

It  is  a  recourse  oul}^  of  persons  interested  in  thrift,  not  in  spec- 
ulation. No  one  can  make  money  for  himself  by  life  insurance 
in  any  other  sense  than  by  systematic  saving.  Any  inordinate 
return  from  life  insurance  payments  must  go  to  others — widows 
and  orphans — not  one's  self.  Its  chief  object,  therefore,  is  to  bring 
about  just  the  condition  most  desirable  for  the  whole  people  and 
to  avert  conditions  for  which  organized  government  and  society 
are  so  heavily  contributing.  And  this  is  being  done,  not  by  gov- 
ernmental compulsion,  as  in  Germany,  England  and  other  coun- 
tries in  Europe ;  it  is  voluntarily  assumed  by  our  American  peo- 
ple, in  other  respects  so  extravagant  and  lacking  in  providence, 
but  in  this  way  laying  by  nearly  $1,000,000,000  a  year  for  this 
largely  unselfish  purpose. 

America  the  One  Country  to  Discourage  Life  Insurance 

And  yet  this  countiy — the  most  liberal  in  paying  for  the  conse- 
quences remedied  or  averted  by  insurance — instead  of  following 
the  almost  universal  practice  of  all  other  countries  and  encour- 
aging insurance,  is  the  one  country  in  the  world  to  penalize  those 
who  voluntarily,  in  the  true  American  spirit,  assume  this  obliga- 
tion themselves! 

Why  Not  Encourage  It? 

It  is  the  wise  practice  of  most  benefactors  to  augment  their  giv- 
ing and  encourage  a  wider  interest  in  the  object  to  which  they 
contribute  by  offering  to  add  their  contributions  to  those  of  others. 
It  is  considered  good  business,  for  example,  for  wealthy  men  to 
offer  say  $100,000  to  a  hospital  or  college  provided  an  equal  amount 
is  raised  elsewhere.  The  financial  shrewdness,  as  well  as  the  wis- 
dom, of  this  course  is  obvious.  And  yet  for  some  reason  not  only 
is  it  the  practice  of  many  of  our  States  and  communities  to  impose 
a  large  inheritance  tax  upon  money  devised  to  the  veiy  beneficent 
institutions  to  which  the  State  is  so  heavily  contributing,  but 
unlike  any  other  country  in  the  world,  civilized  or  uncivilized,  it 
imposes  a  tax  of  over  a  million  a  month — $13,676,096  last  year — 
upon  American  policyholders.  This  is  a  tax  falling  directly  upon 
policyholders  and  does  not  include  the  property  taxes  upon  life 
insurance  assets,  to  which  exception  is  not  taken.  The  tax  im- 
posed last  year  is  about  the  amount  that  such  an  efficient  coun- 
try as  Germany  is  contributing  from  government  funds  in  com- 
pelling and  encouraging  its  people  to  insure,  and  a  sum  that  would 
furnish  life  insurance  protection  for  $500  each  to  1,000,000  more 
families  now  left  without  a  dollar.  We  spend  governmental  and 
private  millions  in  taking  care  of  the  widows  unprovided  for  by 
insurance,  yet  filch  in  taxes  $70  from  each  $1,000  life  insurance 
paid  to  widows  and  orphans  by  the  providence  of  their  husbands 
and  fathers.    We  tax  the  provident  and  unselfish  insured,  instead 


302  WORLD'S  INSURANCE  CONGRESS 

of  taxing  the  delinquent  uninsured.  We  encourage  savings  de- 
posits of  all  other  forms,  even  providing  National  and  State  in- 
stitutions for  savings,  and  yet  tax  the  funds  of  the  still  more 
provident  insured — more  provident  because  he  is  saving  for  a 
longer  period,  by  systematic,  regular  payments,  and  chiefly  for 
others  after  he  is  gone.  What  would  be  the  ultimate  result  if  the 
vast  sum  we  now  pay  publicly  and  privately  to  care  for  dependency 
were  spent  through  life  insurance  to  prevent  it?  What  an  addi- 
tion there  would  be  to  our  National  wealth  and  efficiency,  but  still 
more  to  the  prosperity,  happiness,  intelligence  and  even  moral  wel- 
fare! 

A  Vicious  Principle  Viciously  Applied 

How  this  penalization  of  the  thrifty  and  provident  and  unselfish 
has  grown  in  this  country  need  not  be  here  recounted,  other  than 
to  say  it  is  growing  not  only  in  amount  but  in  percentage ;  that  a 
tax  vicious  in  principle  is,  as  might  be  expected,  viciously  applied. 
The  evils  of  varying  rates  of  State  taxation — from  nothing  in  one 
State  to  three  per  cent  in  others;  of  retaliatory  laws;  of  taxation 
of  gross  income,  contrary  to  any  other  business  in  the  world,  dis- 
regarding the  net  amount  paid  and  taxing  even  the  amount  re- 
funded to  policyholders;  of  compelling  persons  who  live  in  dif- 
ferent States  to  be  subject  to  the  varying  rates  of  taxation  of 
other  States;  of  the  expense  of  48  sometimes  conflicting  kinds  of 
supervision ;  of  not  taxing  any  mutual  assessment  or  fraternal  in- 
surance association,  yet  heavily  taxing  equally  mutual  life  insur- 
ance companies — these  need  not  be  spoken  of  here.  We  wish  merely 
to  give  the  widest  publicity  to  the  inconsistency  with  State  aims 
and  the  interest  of  society  with  the  whole  principle  and  to  sug- 
gest a  remedy. 

No  Recognized  Authority  Defends  It 

We  pass  over  further  discussion  of  the  iniquity  and  inequity,  be- 
cause hardly  a  statesman,  hardly  an  authority  on  social  economy 
or  taxation,  defends  thus  penalizing  America's  provident  insured. 
It  cannot  be  defended  by  the  increasing  needs  of  government,  any 
more  than  the  robbing  of  the  widow  and  orphan  is  justified  by  any 
other  one  who  needs  money.  It  has  been  well  said  by  the  Commit- 
tee on  Insurance  Law  of  the  American  Bar  Association  that  "it 
is  just  as  dishonest  for  a  State  to  lay  unholy  hands  on  trust  funds 
as  for  an  individual  to  do  it." 

No  Other  Country  So  Taxes  Life  Insurance 

Even  in  Europe,  taxed  to  its  utmost  to  pay  the  stupendous 
charges  of  the  va.st  war,  insurance — now  doing  so  much  to  remedy 
the  horrible  European  conditions — not  only  is  free  from  American 
taxation  methods  but  is  being  doubly  encouraged  rather  than  pe- 


WORLD'S  INSURANCE  CONGRESS  303 

nalized.    Why  is  it  that  American  public  ofificials  do  not  wisely  fol- 
low European  wisdom  and  experience  in  this  matter? 

Needs  Publicity  to  Remedy 

Obviously  it  is  due  to  popular  ignorance  and  misconception.  It 
has  been  said  that  no  English  cabinet  so  taxing  life  insurance  would 
hold  office  twenty-four  hours.  If  the  25,000,000  American  policy- 
holders thoroughly  understood  this  question,  taxes  on  insurance 
would  be  wiped  out  as  fast  as  Legislatures  or  Congress  could  meet. 
If  every  legislator  understood  that  over  half  his  constituents  were 
paying  this  tax,  increases  would  cease  and  reductions  would  at 
once  become  popular.  But  there  seems  to  be  the  same  popular  im- 
pression that  some  vague,  mythical  body  of  wealthy  men  is  paying 
this  tax  that  has  led  to  the  taxation  of  life  insurance  funds ! 

Policyholder  Alone  Pays  the  Tax 

As  to  life  insurance  companies,  this  misconception  is  peculiarly 
unjust.  Irrespective  of  the  economic  fact  that  the  tax  ultimately 
falls  upon  the  consumer,  no  institution  of  such  magnitude  as  a 
life  insurance  company  is  so  much  the  property  of  its  own  mem- 
bers and  so  little  the  property  of  any  few  stockholders.  In  no 
other  corporate  institution  must  the  taxation  cost  so  certainly  fall 
upon  the  members  and  upon  no  one  else.  Ninety-two  per  cent 
of  the  assets  and  86  per  cent  of  the  insurance  in  force  is  in 
companies  either  having  no  capital  at  all  or  where  dividends  to 
stockholders  are  absolutely  limited  and  where,  consequently,  any 
expense  must  fall  upon  policyholders;  and  as  for  the  balance  of 
companies,  no  one  knows  better  than  those  familiar  with  insur- 
ance that  the  making  of  even  any  fair  interest  return  upon  the 
capital  paid  in  is  most  difficult.  They  must  all  meet  the  competi- 
tion of  mutual  companies,  which  would  be  obviously  impossible 
were  any  undue  amount  diverted  from  policyholders  mto  profits 
to  others. 

For  the  year  1914  companies  now  entirely  mutual  and  conse- 
quently having  no  stock,  paid  their  policyholders  so-called  "divi- 
dends," really  refunds,  of  $84,346,891.*  Companies  whose  divi- 
dends to  stockholders  were  limited  to  a  fixed  amount  and  whose 
payments  to  stockholders,  therefore,  could  not  possibly  be  affected 
by  taxation,  paid  their  stockholders  but  $727,550,  and  27  times 
as  much— $19,799,586— to  their  policyholders.  Companies  of  all 
kinds  paid  last  year  in  refunds  to  policyholders  $108,006,664,  and 
but  $2,733,929  to  stockholders,  on  stock  of  $53,985,848— a  return 
of  but  5.06  per  cent. 

It  is  obvious,  therefore,  that  the  policyholders  do  bear  this  tax 
and  must  bear  it.     Anything  that  increases  the  cost  of  insurance 

*  The  Metropolitan  and  Prudential  are  included  with  mutual  companies,  as 
since  January  1st  they  have  been  entirely  mutual. 


304       WORLD'S  INSURANCE  CONGRESS 

falls  upon  the  policyholder  and  certainly  in  the  first  two  classes 
cannot  possibly  fall  upon  any  one  else. 

Turn  on  the  Light 

Enlightened  popular  understanding  of  this  problem  must  result 
in  its  diminution,  notwithstanding  the  increasing  cost  of  govern- 
ment. Persons  must  realize  the  folly  of  hindering  persons  from 
doing  what  otherwise  the  State  or  society  must  do  for  them,  of 
throwing  bars  in  the  way  of  progress.  If  policyholders  of  all  com- 
panies were  as  alert  in  so  justly  protecting  themselves  as  are  the 
members  of  fraternal  and  assessment  companies,  instituted  for 
precisely  the  same  purpose,  such  an  unjust  burden  would  be 
quickly  removed. 

Must  Aggressively  Resist  This  Unjust  Burden 

It  is  believed  that  a  defensive  policy  has  been  largely  respon- 
sible for  the  continuance  of  this  taxation.  It  would  seem  that 
every  interest,  ecept  organizations  representing  the  life  insurance 
policyholders,  take  an  active  part  in  legislative  and  especially  tax- 
ation measures  affecting  their  interests.  Where  the  aroused  and 
intelligent  sentiment  and  influence  of  policyholders  has  been  ex- 
erted, it  has  been  effective.  The  plea  for  governmental  encour- 
agement of  life  insurance  rather  than  hindrance  and  penalization 
is  just,  and,  like  any  other  just  cause,  will  prevail  when  properly 
understood,  particularly  as  the  vast  majority  of  voters  are  person- 
ally interested  in  it — at  least  half  of  our  voting  population.  It  is 
our  belief  that  an  organized  and  united  effort  in  every  legislative 
and  congressional  district,  properly  led.  for  the  purpose  of  plac- 
ing this  before  policyholders,  would  make  it  impossible  for  this 
condition  to  increase  and  even  for  it  to  continue. 

United  Action  Demanded 

It  is  unfortunate  that  thus  far  all  insurance  companies  have  not 
been  able  to  maintain  unitedly  one  organization  to  organize  and 
conduct  a  campaign  for  the  protection  of  their  policyholders  by 
the  reduction  or  removal  of  this  unjust  and  indefensible  burden, 
unpredecented  in  any  other  country  in  the  world.  An  organiza- 
tion representing  all  regular  companies  of  all  sections,  arousing 
in  turn  their  agents  and  organizations  of  agents  and  through  them 
the  policyholders,  would  in  due  time  create  such  an  understand- 
ing and  public  interest  that  not  only  would  increases  cease  but 
gradual  reductions  would  be  obtained.  For  example,  the  repeal 
of  the  retaliatory  laws  of  certain  States  could  be  secured  by  united 
and  organized  action;  credits  of  refunds,  perha])s  of  all  payments 
to  policyholders,  might  be  allowed ;  in  States  where  the  rate  was 
far  above  the  average  a  reduction  might  be  obtained,  and  so  an 
increase  of  the  burden  stopped  and  a  decrease  begun  that  would 


WORLD'S  INSURANCE  CONGRESS  305 

continue.  Such  a  united  organization  for  a  just  purpose  is  surely 
worth  while  not  only  to  save  $13,500,000  annually  to  our  policy- 
holders but  to  prevent  its  increase ;  and  such  a  campaign  would  be 
well  justified  were  nothing  else  accomplished  than  to  spread  abroad 
the  real  purpose  of  life  insurance  and  proclaim  who  are  really  af- 
fected by  all  measures  that  affect  the  institution  as  a  whole.  It 
would  also  make  it  impossible  for  legislators  to  taunt  us  with  the 
fact  that  we  are  neither  organized  nor  agreed  among  ourselves  and 
that  consequently^  as  we  cannot  unitedly  state  our  own  wants,  they 
necessarily,  even  if  ignorantly,  must  decide  them  for  us.  Surely 
the  regular  companies  should  be  as  much  organized  as  the  fra- 
ternal societies,  that,  with  certainly  no  more  reason  for  tax  ex- 
emption, have  maintained  themselves  absolutely  exempt  from  any 
form  of  taxation,  while  the  companies  have  borne  it  all. 

Legislators  "Will  Help  When  They  Understand 

In  suggesting  a  campaign  against  taxation,  reflection  upon  pub- 
lic men  in  our  legislatures  is  not  intended.  When  even  our  policy- 
holders misunderstand  what  life  insurance  really  is  and  who  really 
bears  all  it«  expense,  it  is  not  surprising  that  public  men  have 
such  vague  ideas  as  to  what  even  mutual  life  insurance  companies 
are  that  they  do  not  appreciate  the  fact  that  they  are  taxing  the 
policyholder,  the  widow  and  the  orphan.  Legislators  are  pressed 
upon  every  side  for  funds  for  State  expenses;  they  are  not  likely 
to  inquire  too  closely  into  who  pays  taxes  when  little  objection  is 
made ;  and  if  they  do  not  know  that  their  constituents  are  af- 
fected and  to  what  extent,  they  are  often  likely  to  be  little  con- 
cerned by  the  opposition  of  some  distant  corporation,  perhaps  one 
which  it  is  politically  advantageous  to  tax  or  criticize. 

MoBH^iziNG  25,000,000 

Twenty-five  million  policyholders — excluding  the  non-voters 
such  as  minors,  children  insured  under  industrial  policies  and 
women  in  non-equal  suffrage  States — will  mean  that  in  most  legis- 
lative districts  at  least  a  majority  of  constituents  are  themselves 
policyholders  and  more  than  a  majority  of  the  population  in  some 
way  interested.  Legislators  themselves  do  not  understand  the 
question,  the  public  certainly  does  not ;  and  if  the  sunlight  of  pub- 
licity and  intelligent  understanding  were  turned  upon  this  sub- 
ject, the  righteousness  of  the  cause  could  not  be  withstood  and 
the  result  would  not  be  uncertain.  We  have  relied  too  much  upon 
a  defensive  attitude.  Organization  is  as  necessary  for  defense  as 
for  war.  It  is  aggressiveness  in  the  right  cause,  particularly  in 
an  intelligent  and  free  country,  that  will  untimately  triumph. 


306  AVORLD'S  INSURANCE  CONGRESS 


NATIONAL  SUPERVISION 

By  George  W.  ]\Iiller 
President,  National  Fraternal  Congress  of  America 

The  late  Mr.  Justice  Ricks,  writing  for  the  Supreme  Court  of 
Illinois  in  a  case  (North  American  Insurance  Company  v.  Yates, 
214  111.  272)  brought  by  the  insurance  commissioner  of  that  State 
to  enjoin  certain  fire  insurance  companies  and  individuals,  agents 
of  these  companies  from  transacting  the  business  of  fire  insurance 
in  that  State  without  complying  with  the  laws  of  the  State  relative 
thereto,  said: 

"The  business  of  insurance  is  the  outgrowth  of  time  and  the 
demands  and  necessities  of  the  public.  It  extends  into  and  covers 
almost  every  branch  of  business  and  all  the  relations  of  life,  and 
is  applied  to  all  the  hazards  of  business  in  life  where  a  basis  of 
risk  and  compensation  can  be  estimated.  In  all  the  stages  of 
life,  from  the  cradle  to  the  grave,  it  asserts  an  interest  and  offers 
succor  and  aid.  In  the  business  enterprises,  whether  by  land  or 
sea ;  in  the  possessions  of  men,  from  a  pane  of  glass  to  the  mansion 
or  the  factory ;  in  his  undertakings  involving  every  chance,  mis- 
fortune, moral  turpitude  or  the  act  of  God,  it  demands  admission 
and  promises  indemnity,  reward  or  gain.  It  poses  as  the  faithful 
and  zealous  trustee  of  his  earnings  and  savings,  and  promises  to 
the  widow  and  orphan  a  guaranty  against  misery  and  want.  It 
intercedes  between  principal  and  agent,  master  and  servant,  con- 
tractor and  owner,  and  insures  against  loss  from  almost  any  and 
every  cause.  It  is  a  public  necessity  that  deals  in  its  own  credit 
for  a  cash  consideration  from  the  assured,  and  is  stamped  with 
public  interest,  and  must  yield  obedience  to  necessary  and  proper 
regulations  by  the  State  in  the  exercise  of  its  police  power," 

The  judge  who  thus  wrote  was  rather  more  eloquent  than  is 
customary  in  the  pages  of  the  reports  of  courts  of  last  resort, 
but  he  comprehended  the  importance  of  insurance  and  his  picture 
was  not  overdrawn.  In  his  opinion  it  is  pointed  out  that  the 
business  of  insurance  is  usually  conducted  by  corporations, 
creatures  of  the  law  which  have  no  natural  rights  but  whose  rights 
and  immunities  are  to  be  found  in  the  law. 

The  great  majority  of  insurance  companies  or  societies  doing 
business  in  the  United  States  have  been  organized  under  State 
statutes ;  hence  in  every  State  other  than  their  home  State  in  which 
they  are  licensed  to  do  business  they  occupy  the  position  of  foreign 
corporations.  The  twenty  companies  that  were  at  the  bar  of  the 
Illinois  court  in  the  case  referred  to  were  foreign  corporations, 
and  to  this  the  court  called  attention  in  pointing  out  that  they 


WORLD'S  INSURANCE  CONGRESS  307 

came  into  Illinois  subject  to  such  conditions  as  the  legislature  of 
that  State  had  prescribed  and  were  bound  to  observe  the  public 
policy  of  that  State  with  reference  to  insurance  which  policy  was 
to  be  found  in  the  statutes  of  the  State;  and  then  the  court  ob- 
served that  the  public  policy  of  Illinois  touching  insurance  com- 
panies was  "amply  attested"  by  over  forty  statutes  relating  to 
them,  eighteen  of  which  then  in  force  related  solely  to  fire  insur- 
ance, the  branch  of  insurance  with  which  the  court  was  then 
more  particularly  dealing. 

The  court,  as  further  evidence  of  the  importance  of  the  insur- 
ance business,  observed  further  that  Illinois  had  created  a  special 
branch  of  the  government  designated  "Insurance  Department  of 
the  State  of  Illinois"  charged  with  the  execution  of  all  laws  of 
the  State  in  relation  to  that  subject. 

This  case  well  suggests,  first,  the  tremendous  dimensions  to 
which  the  business  of  insurance  in  all  its  branches  has  attained, 
and,  second,  something  of  the  difficulties  with  which  the  business 
of  insurance  must  contend. 

The  United  States  of  America  now  has  forty-eight  States.  For 
present  purposes  its  territories  need  not  be  adverted  to.  Insurance 
in  its  ramifications  has  not  only  reached  into  every  one  of  these 
States,  but  into  every  county,  city,  village  and  hamlet  in  every  one 
of  them.  Speaking  of  the  fraternal  beneficiary  system  of  insurance 
W'ith  which  the  writer  has  had  most  to  do,  the  1915  edition  of 
"Statistics  Fraternal  Societies"  gives  a  list  of  one  hundred 
ninety-eight  of  these  societies  having  a  benefit  membership  on  Jan- 
uary 1,  1915,  of  over  eight  million,  with  insurance  in  force  on 
that  date  of  over  nine  and  one  quarter  billions  of  dollars,  and 
these  societies  included  in  the  list  mentoned  are  shown  by  this 
publication  to  have  paid  in  benefits  during  the  year  1914  over 
one  hundred  millions  of  dollars.  The  writer  does  not  have  at 
hand  the  number  of  the  holders  of  policies  issued  by  so  called 
old  line  insurance  companies  nor  the  aggregate  amount  of  their 
outstanding  policies  nor  the  amounts  which  these  companies  have 
paid  in  benefits  even  during  a  single  year,  but  from  the  figures 
which  have  been  given  with  reference  to  the  fraternals  it  will  be 
easily  understood  that  these  figures  with  reference  to  the  old  line 
companies  have  been  stupendous. 

Insurance  departments  have  been  created  or  the  power  of  super- 
vision of  insurance  vested  in  some  existing  department  in  every 
State  in  the  Union  and  the  public  policy  of  these  States  has  been 
evidenced  by  statutes  of  which  Illinois,  in  numbers  at  least,  may 
be  considered  to  be  a  fair  sample.  We  have  investment  laws, 
license  laws,  deposit  laws,  valuation  laws,  rate  laws,  minimum 
membership  and  assessment  laws,  re-insurance  laws,  liability  and 
emergency  assessment  laws,  examination  laws,  annual  statement 
laws,  reserve  laws,  retaliatory  laws,  laws  prescribing  forms  of 
policies  and  contracts,  and  it  will  be  of  particular  interest  to  the 
representatives  of  the  fraternal  beneficiary  system  of  insurance 


308  WORLD'S  INSURANCE  CONGRESS 

who  may  be  present  to  know  that  a  bill  was  introduced  in  the 
Illinois  legislature  at  its  last  session  which,  if  enacted  into  law 
and  sustained  by  the  courts,  would  have  prohibited  the  reelection 
of  any  officer  of  any  of  these  organizations.  The  gentleman  who 
introduced  this  bill  belonged  to  a  society  which  had  sought  to  bring 
about  a  much  needed  increase  in  rates,  to  which  he,  being  an  insur- 
gent, was  opposed.  The  increase  was  urged  by  officers  who  had 
been  in  charge  of  the  affairs  of  the  society  for  several  terms  and 
were  thoroughly  familiar  with  its  condition  and  the  necessity  for 
the  increase.  The  father  of  this  bill  undertook  to  set  this  rates 
controversy  his  way  bj^  legislating  the  officers  out  of  office,  little 
thinking  or  perhaps  Ittle  caring  what  such  a  law  would  do  to  the 
entire  fraternal  beneficiary  system. 

The  foregoing  list  of  laws  with  which  insurance  is  required  to 
deal  is  not  offered  as  exhaustive,  but  there  is  a  limit  to  the  length 
of  time  which  the  reading  of  this  paper  may  consume  and  the 
writer  does  not  desire  to  use  all  of  that  time  in  a  mere  enumera- 
tion of  insurance  laws. 

Insurance,  then,  has  at  least  forty-eight  supervisors.  The  emi- 
nent gentlemen  who  now  hold  the  positions  of  commissioners  of 
insurance  in  the  several  States  will,  the  writer  feels  assured,  take 
no  offense  at  the  suggestion  that,  whether  it  be  true  of  any  of  them, 
it  has  been  true  that  in  the  past  some  of  these  offices  have  been 
held  by.  men  who  have  had  very  little  knowledge  of  the  business. 
Men  and  women  who,  as  managing  officers  of  insurance  organiza- 
tions, have  become  masters  of  their  business,  have  and  are  devoting 
their  lives  to  this  work,  while  in  all  too  many  instances  men  who 
have  been  appointed  commissioners  of  insurance  in  some  of  the 
States  have  received  their  appointments,  not  because  of  their  quali- 
fications to  supervise  the  business  of  insurance  but  because  of  their 
qualifications  along  political  lines;  and  it  has  been  true  too  often 
that  where  men  thus  appointed  have  seriously  devoted  themselves 
to  a  study  of  insurance  so  that  by  the  time  their  terms  have  ex- 
pired they  have  fairly  well  equipped  themselves  to  be  good  com- 
missioners of  insurance,  the  wheels  of  politics  in  their  uncertain 
revolutions  have  turned  them  out  and  their  places  have  been 
taken  by  those  who  knew  as  little  if  not  less  than  they  knew  at 
the  time  of  their  appointments. 

These  men  and  women,  therefore,  who,  after  years  of  study  and 
experience  have  become  experts  in  their  line  of  work  and  hence 
eminently  qualified  to  manage  successfully  their  institutions,  must 
in  all  too  many  States  submit  to  supervision  and  regulation  by 
officials  who  possess  only  a  bare  smattering  of  knowledge  with 
reference  to  the  business  of  insurance. 

It  is  not  always  true  that  these  State  officials  confine  themselves 
within  the  limitations  of  supervision.  There  have  been  instances 
when  some  of  these  officials  have  apparently  lost  sight  of  the 
dividing  line  between  supervision  and  management,  and  nave  not 
been  content  with  supervising  to  see  if  insurance  organizatons  are 


WORLD'S  INSURANCE  CONGRESS  309 

being  operated  within  the  limits  of  the  law  and  requiring  them  to 
do  so,  but  have  undertaken  to  pass  judgment  upon  questions  of 
policy  and  of  management  and  upon  the  wisdom  of  acts  clearly- 
coming  within  the  domain  of  management  and  over  which  super- 
vising officers  have  no  control. 

Each  commissioner  of  insurance,  of  course,  has  power  and  it 
is  his  duty  to  run  his  own  department  and  in  the  first  instance, 
at  least,  he  must  construe  and  enforce  the  laws  of  his  State  as  he 
understands  them,  and  under  the  statutes  in  most  if  not  all  of  the 
States  certain  general  powers  are  vested  in  the  commissioners 
under  which  they  may  make  rules  and  regulations  which  insurance 
organizations  are  required  to  comply  with;  and  frequently  some 
commissioner,  with  a  mistaken  idea  as  to  the  limits  of  his  powers, 
undertakes  to  enforce  requirements  for  which  there  is  no  warrant 
in  the  law. 

Again  let  it  be  said  the  writer  is  not  indulging  in  criticism 
but  merely  dealing  with  facts.  Insurance  commissioners  are  hu- 
man. No  divine  hand  doth  hedge  them  about,  but  they  possess  the. 
strength  and  the  weaknesses  common  to  the  ordinary  run  of  human 
kind.  There  can  be  but  one  result  from  such  a  situation  as  has 
been  pointed  out,  and  that  is  that  insurance  organizations  of  all 
kinds  are  torn  and  buffeted  between  conflicting  and  irreconcilable 
statutes,  rulings  and  regulations.  There  is  lack  of  uniformity  in 
the  supervision  and  regulation  of  a  business  which  has  become 
country-wide  and  world-wide  and  where,  so  far  as  the  United 
States  of  America  is  concerned,  there  should  be  uniformity. 

The  writer  thinks  that  at  this  day  no  intelligent  man  or  woman 
will  be  heard  to  contend  that  the  business  of  insurance  should  be 
free  from  supervision.  Supervision  of  insurance  is  here  and  it 
should  be  here,  but  that  supervision  should  not  be  a  burden  to  the 
business  it  is  designed  to  benefit. 

But  all  this  is  general  in  its  treatment  of  this  subject,  whereas 
it  may  be  the  better  elucidated  by  a  few  concrete  illustrations  of 
what  State  supervision  of  insurance  means.  The  writer  has  in 
mind  an  instance  where  an  eminent  actuary  recently  filed  reports 
for  an  association  with  a  number  of  the  departments.  Questions 
were  raised  by  four  of  the  commissioners  with  reference  to  the 
report  and  among  these  four  three  different  positions  were  takeu 
upon  the  same  question.  Three  of  the  four  commissioners  were 
finally  brought  to  the  same  view,  while  the  other  gentleman  took 
the  position  that  it  was  immaterial  to  him  what  was  the  position 
of  the  departments  in  other  States,  for  his  department  was  con- 
trolled by  his  own  opinion  of  what  the  report  should  show  and 
he  required  a  different  report  from  that  of  any  of  the  other  of 
the  forty-six  departments  to  whom  this  report  was  submitted. 

After  accepting  the  invitation  to  prepare  this  paper,  the  writer 
invited  a  prominent  society  to  furnish  him  with  a  list  of  instances 
illustrative  of  the  troubles  growing  out  of  the  system  of  supervision 
by  States.    It  will  serve  the  writer 's  purpose  to  note  the  following : 


310       WORLD'S  INSURANCE  CONGRESS 

The  State  of  North  Carolina  has  a  statute  providing,  in  sub- 
stance, that  each  foreign  insurance  company,  association  or  order 
doing  business  in  that  State  on  the  assessment  plan  shall  keep  at 
all  times  deposited  at  its  head  office  in  that  State  or  in  some 
responsible  banking  or  trust  company  one  regular  assessment 
sufficient  to  pay  the  average  loss  or  losses  occurring  among  its 
members  during  the  time  allowed  by  it  for  the  collection  of  assess- 
ments and  payment  of  losses. 

It  is  perfectly  clear  that  under  this  statute  the  funds  deposited 
in  that  State  cannot  be  held  solely  for  the  payment  of  claims 
arising  in  that  State,  and  j'et  varying  interpretations  have  been 
placed  by  the  different  departments  on  this  statute,  some  holding 
that  the  deposit  made  under  it  is  a  special  deposit  and  others  a 
general  deposit. 

The  departments  have  not  agreed  in  their  requirements  for 
valuing  bonds.  To  illustrate,  Minnesota  accepts  the  amortization 
plan,  while  New  York,  IMichigan  and  Connecticut  take  the  market 
values ;  and  in  States  where  the  market  value  is  the  basis,  the  same 
bonds  may  not  be  valued  at  the  same  amounts,  although  as  a 
matter  of  fact  in  nearl}^  every  instance  it  is  true  that  there  is  no 
occasion  whatsoever  to  sell  the  bonds,  but  they  have  been  pur- 
chased with  the  view  of  holding  them  until  maturity  and  every- 
one knows  that  in  all  human  probability  the  organization  holding 
them  will  receive,  from  time  to  time  as  it  matures,  the  interest 
at  the  stipulated  rate  and  the  full  face  of  the  bonds  at  maturity. 

Varying  regulations  are  made  as  to  the  arrangement  of  sched- 
ules, so  that  the  different  departments  frequently  require  special 
statements  to  conform  to  the  details  of  their  own  clerical  w'ork, 
evidently  having  more  regard  for  the  convenience  of  their  own 
■departments  than  for  the  expense  and  convenience  of  the  organi- 
sations required  to  make  these  reports. 

The  position  of  the  Connecticut  department  has  been  that  the 
liabilities  for  a  year  should  include  all  claims  arising  from  deaths 
occurring  before  January  1st  next  succeeding.  It  is  the  experi- 
ence of  most  organizations  that  a  few  deaths  occurring  in  the 
very  latter  part  of  a  year  are  frequently  not  reported  to  the  home 
office  before  the  latter  part  of  the  following  January,  so  that 
if  the  books  were  to  be  held  open  to  include  those  deaths  in  the 
annual  statement  they  could  not  be  closed  before  the  end  of  Jan- 
uary; but  the  Michigan  department  requires  that  the  completed 
statement  must  be  ready  for  final  inspection  by  that  department 
by  not  later  than  the  middle  of  that  month. 

The  Iowa  department  now  has  a  requirement  with  reference  to 
valuations  which  is  at  variance  with  and  requires  valuations  upon 
a  different  basis  from  that  of  any  other  department. 

A  few  years  ago  the  Minnesota  department  made  a  ruling  with 
reference  to  the  laws  of  an  association  whicli,  if  complied  with. 
would  have  required  a  ti'ansfer  of  moneys  from  one  fund  to  an- 


WORLD'S  INSURANCE  CONGRESS  311 

other.     This,   if  made,   would  not  have  been  recognized  by  the 
departments  of  other   States. 

Separate  reports  must  be  made  to  the  department  of  each  State 
in  which  an  organization  is  doing  business  and,  as  has  already 
been  indicated,  these  may  not  be  copies  of  a  single  report.  It 
would  seem  that  it  might  serve  to  deliver  to  the  other  depart- 
ments copies  of  an  annual  report  made  to  the  department  of  the 
home  State  of  an  institution,  particularly  where  approved  by  the 
home  State ;  but  not  so.  All  this  is  expense,  for  it  involves  labor 
and  the  expense,  of  course,  in  the  end  falls  upon  the  policy  or 
certificate  holders.  Furthermore,  each  State  has  the  right  under 
its  laws  to  examine  annually,  or  more  frequently  if  it  desires, 
through  its  insurance  department,  every  company  and  society 
doing  business  therein  and  under  most  of  tbe  laws  relating  to 
fraternal  beneficiary  societies  this  examinaton  is  to  be  made  at 
the  expense  of  the  societies.  The  writer  presumes  this  is  also  true 
with  reference  to  old  line  companies.  Instead  of  there  being  one 
examination  Avhich  must  serve  for  the  whole  country  there  may 
be  as  many  examinations  each  year  as  there  are  States  in  which 
the  particular  institution  is  doing  business  and  these  examinations 
may  be  as  much  more  frequent  than  annually  as  the  commission- 
ers may  see  fit  and  all  this  at  the  expense  of  the  company  or  so- 
ciety. It  is  but  just  to  say  that  examinations  of  the  same  insti- 
tution are  not  conducted  each  year  by  each  department.  On  the 
contraiy,  through  an  organization  of  insurance  commissioners  de- 
signed to  bring  about  greater  uniformity  and  to  lessen  some  of 
these  evils  to  which  State  supervision  is  subject,  examinations  are 
made  by  a  limited  number  of  departments  selected  for  that  pur- 
pose and  the  reports  of  these  examinations  are  accepted  as  a  rule 
by  other  departments,  but  the  opportunity  for  abuse  is  ever 
present. 

These  evils  are  somewhat  lessened  by  the  organization  of  in- 
surance commissioners  which  meets  at  least  annually,  one  of  the 
purposes  of  which  is  to  bring  about  uniformity  in  laws,  depart- 
mental rules  and  requirements,  blanks,  etc.  It  should  be  said 
that  much  good  has  been  accomplished  by  this  organzation  of  com- 
missioners, and  yet  the  necessity  for  such  an  organization,  the 
very  existence  of  the  organization,  is  evidence  of  the  weakness 
and  an  argument  against  supervision  of  insurance  by  the  States. 
Another  danger  of  great  magnitude  has  but  lately  made  its  ap- 
pearance. While  supervision  of  insurance  has  been  with  us  for 
many  years,  it  has  been  but  very  recently  that  an  attempt  has  been 
made,  through  State  legislation,  to  prescribe  the  rates  or  pre- 
miums which  insurance  may  charge.  In  Paul  v.  Virginia,  the 
court  said  that  insurance  was  not  commerce  because  contracts  of 
insurance  are  personal  contracts.  The  court  emphasizes  this  in 
the  Deer  Lodge  County  case  and  concedes  it  in  the  case  to  which 
I  am  about  to  make  reference. 

It  is  optional  with  our  citizens  whether  they  will  or  will  not 


312       WORLD'S  INSURANCE  CONGRESS 

carry  insurance,  and  it  is  for  insurance  organizations  to  say 
whether  they  will  or  will  not  issue  a  policy  or  certilicate  to  any 
particular  individual  who  may  apply  therefor.  It  has  been 
thought,  at  least  by  many,  that  while  the  business  of  insurance 
was  subject  to  supervision  under  the  police  power  of  the  State, 
that  power  did  not  extend  far  enough  to  enable  the  States  to  regu- 
late rates,  but  the  Supreme  Court  of  the  United  States,  in  its  opin- 
ion filed  in  April,  1914,  in  German  Alliance  Insurance  Company  v. 
Lewis  (233  U.S.  389)  sustained  the  constitutionality  of  a  Kansas 
statute  authorizing  the  commissioner  of  insurance  of  that  State 
to  fix  tire  insurance  rates.  Under  that  statute  if  he  thinks  they 
are  too  high  he  may  lower  them,  and  if  he  thinks  they  are  too  low 
he  may  increase  them.  It  would  be  of  interest  to  analyze  the 
views  of  the  court  as  expressed  in  the  opinion  of  iNIr.  Justice  Mc- 
Kenna  and  concurred  in  by  four  of  his  brethren,  and  the  views  of 
Mr.  Justice  Lamar  expressed  in  his  vigorous  dissenting  opinion, 
which  was  concurred  in  by  two  of  his  brethren,  including  the 
chief  justice  of  the  court;  but  time  forbids. 

If  the  States  may,  under  the  policy  power,  regulate  rates  for 
fire  insurance,  it  would  seem  to  follow  that  the  same  thing  may 
be  done  with  every  other  kind  of  insurance.  The  opinion  in  the 
Lewis  case  contains  nothing  to  indicate  that  the  holding  of  the 
court  was  limited  to  fire  insurance,  but  the  doctrine  which  the 
court  announced  applied  to  insurance  generally. 

With  this  power  in  the  States  thus  established,  insurance  is 
in  this  situation:  As  to  all  insurance  organizations  incorporated 
under  the  laws  of  Kansas,  the  legislature  of  that  State  may,  di- 
rectly or  through  the  commissioner  of  insurance,  control  the  rates 
to  be  charged  by  them  because  they  are  the  creatures  of  that  State. 
As  to  every  insurance  organization  incorporated  under  the  laws 
of  another  State  seeking  to  do  business  in  Kansas,  their  rates  in 
Kansas  may  be  regulated  and  controlled  because,  as  foreign  cor- 
porations, they  have  no  right  to  do  business  in  Kansas — not  being 
engaged  in  interstate  commerce — except  under  such  conditions  as 
Kansas  sees  fit  to  prescribe.  More  than  this,  Kansas  may  regulate 
and  control  rates  to  be  charged  by  these  so-called  foreign  corpora- 
tions outside  of  Kansas  as  a  condition  under  which  they  will  be 
permitted  to  do  business  in  Kansas,  for,  if,  as  is  clearly  established. 
Kansas  may  exclude  such  corporations  entirely,  she  may  stipulate 
any  conditions  she  sees  fit  upon  which  they  may  be  permitted  to 
enter  and  transact  business  within  her  territorial  limits. 

This  much  being  clear  as  to  Kansas,  it  is  equally  clear  that 
the  same  powers  are  possessed  by  every  other  State  in  the  I^nion, 
and  so  under  this  power  to  regulate  and  control  rates,  Kansas  may 
say  to  insurance  organizations  incorporated  under  the  laws  of 
other  States  that  they  shall  not  be  permitted  to  do  business  in 
Kansas  if  they  charge  rates  elsewhere  to  exceed  those  prescribed 
by  its  legislature  or  by  the  commissioner  of  that  State.  California, 
through  the  exercise  of  this  same  power  and  with  a  commissioner 


WORLD'S  INSURANCE  CONGRESS  313 

who  does  not  agree  with  the  commissioner  of  Kansas  as  to  what 
the  rates  should  be,  may  fix  another  rate,  and  Illinois  still  an- 
other, and  thus  put  insurance  in  the  position  where  it  will  be 
doing  business  in  one  State  upon  one  rate  basis,  in  another  State 
upon  another,  and  this  may  be  continued  as  long  as  the  list  of 
States  holds  out.  But  this  is  not  all,  for,  as  the  writer  has  al- 
ready pointed  oiit,  Kansas,  if  not  content  to  undertake  to  regu- 
late and  control  rates  to  be  charged  in  Kansas,  may  tix  rates  to 
be  charged  everywhere  and  exclude  from  that  State  every  insur- 
ance organization  not  complying  with  the  Kansas  requirements. 
Suppose,  therefore,  that  Kansas,  in  the  exercise  of  this  power,  has 
prescribed  maximum  rates  and  has  provided  that  no  organization 
shall  be  permitted  to  do  business  in  Kansas  which  elsewhere  col- 
lects a  rate  in  excess  of  this  maximum  rate.  California  may  be- 
lieve this  rate  to  be  too  low  and  through  its  legislature  may  pro- 
vide that  no  insurance  organization  shall  be  permitted  to  do 
business  in  that  State  which  does  not  charge  rates  in  excess  of  the 
maximum  rate  prescribed  by  Kansas.  Under  such  a  situation 
as  this,  verily  would  insurance  be  "between  the  devil  and  the 
deep  sea,"  and  with  similar  power  vested  in  every  State  in  the 
Union,  it  will  be  at  once  perceived  that,  if  these  States  should 
exercise  this  power,  insurance  would  be  between  a  number  of 
devils  and  deep  seas.  Of  course,  the  exercise  of  this  power  by  a 
number  of  States  where  there  was  lack  of  uniformity  in  the  rates 
prescribed  would  be  destructive  of  insurance. 

Nor  will  it  be  sufficient  to  say  there  is  no  likelihood  of  such 
a  situation  developing.  Kansas  has  exercised  the  power  and 
who  can  say  that  other  States  will  not  do  likewise.  In  fact,  five 
or  six  other  States  have  already  done  so  in  one  form  or  another. 
Furthermore,  under  this  Kansas  statute  there  is  no  assurance  of 
stability  in  rates.  When  the  commissioner  shall  determine  any 
rate  is  excessive  or  unreasonably  high  or  not  adequate  for  the 
safety  or  soundness  of  the  company,  he  is  authorized  to  direct  the 
company  to  publish  and  file  a  higher  or  a  lower  rate  which  shall 
be  commensurate  with  the  character  of  the  risk;  but  in  every 
case  the  rate  shall  be  reasonable — is  the  language  of  the  statute. 
The  commissioner  may  change  his  mind  from  time  to  time  as  to 
what  is  an  excessive  or  unreasonably  high  rate  or  a  sufficient  rate, 
or  the  commissioner's  successor  may  not  agree  with  him  and  hence 
change  the  rates;  and  while  it  is  true  relief  may  be  had  in  the 
courts,  at  least  by  domestic  corporations,  from  an  unreasonable 
rate,  insurance  could  be  involved  in  such  a  mass  of  litigation  by 
an  exercise  of  this  rate-making  power  by  the  States  as  would 
destroy  it  before  the  courts  could  give  it  relief.  The  danger  is 
present  and  in  the  determination  of  whether  National  supervision 
is  preferable  to  State  supervision  no  one  should  overlook  or  under- 
estimate this  danger. 

But  these  are  by  no  means  the  only  objections  to  State  super- 
vision.    The  States  have  spent  millions  of  dollars  in  the  erection 


314       WORLD'S  INSURANCE  CONGRESS 

and  mainteuance  of  schools  for  the  blind,  hospitals  for  the  insane 
and  for  the  poor  and  needy,  poor  farms  for  the  support  of  those 
who  are  unable  to  support  themselves  and  who  have  no  relatives 
who  can  be  made  to  support  them,  and  along  other  but  .siauiar 
lines.  Millions  are  being  expended  each  year  for  such  purposes 
and  these  expenditures  have  the  approval  of  all  our  people.  They 
are  designed  to  relieve  the  distress  of  human  kind.  The  funds  from 
which  these  expenditures  are  made  are  in  the  mahi  eonlnbuied 
by  our  people  in  the  way  of  taxes,  and  this  burden,  in  theory 
at  least,  is  spread  over  all  our  people.  It  would  be  an  intolerable 
suggestion  to  ask  our  citizens  who  pay  this  tax  to  also  pay  a  tax 
upon  the  tax. 

Through  insurance  millions  of  our  people  voluntarily  contribute 
to  the  creation  of  funds,  the  purpose  of  which  is  to  spread  over 
those  who  thus  voluntarily  contribute,  the  losses  sustained  and 
damage  suffered  among  these  contributors  or  their  beneticiaries, 
through  fire,  storms,  the  perils  of  the  sea,  accidents,  disability  tem- 
porary and  permanent,  death  and  whatever  else  may  be  insured 
against,  to  the  end  that  the  individuals  to  whom  this  loss  or  dam- 
age has  come  shall  not  be  required  to  bear  it  alone,  and  the  bil- 
lions of  money  which  have  thus  been  disbursed  by  insurance  and 
which  have  not  come  from  the  pockets  of  all  our  people,  but  from 
the  pockets  of  those  who  have  carried  insurance,  have  operated  to 
save  our  governments  from  the  expenditure  of  moneys  in  the  lines 
above  suggested,  in  amounts  which  no  one  can  estimate  with  any 
degree  of  accuracy. 

These  contributions,  paid  by  those  who  carry  insurance,  which 
the  old  line  companies  call  premiums  and  which  the  fraternals 
call  assessments  or  rates  or  contributions,  have  been  likened  to 
a  tax,  but  voluntarily  imposed.  It  should  be  the  policy  of  the 
States  to  encourage  people  to  carry  insurance  and  thus  to  enjoy 
such  protection  as  insurance  gives.  It  has  been  and  is  the  policy 
of  the  States  to  levy  tribute  upon  these  premiums  or  contributions 
which  people  must  pay  in  order  to  carry  insurance. 

In  a  pamphlet  which  it  was  the  privilege  of  the  writer  of  tlis 
paper  to  read  a  short  while  ago,  it  was,  in  substance,  stated  hv 
way  of  illustration  that  if  death  should  take  the  head  of  a  family 
in  a  community  and  a  committee  should  be  appointed  to  raise  by 
voluntary  contributions  a  fund  of  a  thousand  dollars  among  the 
neighbors  for  this  family,  and,  upon  collecting  this  amount,  this 
committee,  as  it  entered  the  door  of  this  home  to  deliver  to  the 
widow  the  money  collected,  should  be  met  by  a  tax  collector,  who, 
on  behalf  of  the  State,  should  demand  that,  from  this  money  thus 
voluntarily  contributed,  should  be  paid  to  the  state  fifty  or  sev- 
enty-five dollars,  the  tax  collector  would  probably  be  promptly 
mobbed  ;  and  yet  that  is  what  is  being  done,  in  effect,  under  the 
cloak  of  the  law  in  every  state  in  this  Union  as  to  most  forms  of 
insurance.  In  a  paper  prepared  by  Mr.  John  F.  Dryden  and  read 
before  a  meeting  of  the  Boston  Life  Underwriters  in   1904,  he 


WORLD'S  INSURANCE  CONGRESS  315 

stated  that  during  the  preceding  forty  years  the  life  insurance  com- 
panies of  this  country  had  paid  in  taxes  about  one  hundred  mil- 
lions of  dollars  and  that  the  annual  amount  which  they  were  pay- 
ing at  that  time  in  taxes,  licenses,  fees,  etc.,  was  about  nine  mil- 
lion dollars.  In  a  comparatively  recent  article  prepared  by  the 
then  Vice-President  of  the  National  Association  of  Life  Underwrit- 
ers is  the  statement  that  American  life  insurance  policyholders 
pay  over  thirteen  million  dollars  in  taxes.  The  total  receipts  of 
the  insurance  department  of  the  State  of  Wisconsin  for  the  year 
ending  June  30,  1915,  were  $1,106,981.66.  Of  course,  this  money 
in  the  end  must  come  and  does  come  from  the  policyholders  of  the 
companies  from  whom  these  taxes  are  collected.  The  writer  is 
aware  that  these  tax  regulations  are  not  applied  to  all  forms  of 
insurance  organizations,  but  he  is  dealing  now  with  supervision 
of  insurance  as  a  whole  and  not  as  applied  to  any  particular  class 
of  institutions. 

The  point  is  that  the  States  whose  sole  aim  should  be  super- 
vision in  so  far  as  supervision  is  necessary  for  the  protection  of 
the  insured  and  not  beyond  that,  have  seized  upon  this  power  of 
supervision  and  regulation  to  make  it  a  source  of  revenue  produc- 
tion, and  millions  of  dollars  are  being  annually  collected,  not  for 
purposes  of  defraying  the  expenses  of  supervision  but  as  revenue 
for  the  States  pure  and  simple.  There  has  also  grown  up  among 
the  States  a  disposition  to  see  to  it  that  each  State  gets  out  of 
the  companies  doing  business  within  its  borders,  but  organized 
under  the  law^s  of  other  States,  as  much  in  revenue  as  other 
States  get  from  companies  organized  under  its  laws,  and  this  has 
led  to  our  retaliatory  statutes. 

Mr.  Justice  Hughes,  writing  for  the  Supreme  Court  of  the 
United  States  in  the  celebrated  Minnesota  rates  cases  (230  U.S. 
352,  p.  398)  and  discussing  general  principles  governing  the  ex- 
ercise of  State  authority  when  inter-state  commerce  is  affected, 
pointed  out  that  the  power  of  Congress  to  regulate  commerce 
among  the  several  states  is  supreme  and  plenary,  complete  in  it- 
self; may  be  exercised  to  its  utmost  extent  and  acknowledges  no 
limitations  other  than  are  prescribed  in  the  constitution,  and  in 
this  connection  he  said: 

"The  conviction  of  its  necessity  sprang  from  the  disastrous  ex- 
periences under  the  Confederation  when  States  vied  in  discrimi- 
natory measures  against  each  other." 

It  was  in  order  to  end  these  evils,  said  the  learned  .iustioe.  that 
the  grant  was  made  in  the  Constitution  eonferrinsr  uron  '^oiitr^'n'^'^: 
authority  at  all  times  adequate  to  secure  the  freedom  of  interstate 
commercial  intercourse  from  State  control  and  to  provide  effective 
regulation  of  that  intercourse  as  the  National  interests  may  de- 
mand ;  but,  as  all  now  know,  that  grant  has  proven  ineffectual  to 
protect  the  business  of  insurance  from  evils  which  existed  in  the 


316       WORLD'S  INSURANCE  CONGRESS 

days  of  the  Confederation,  for  while  there  may  have  eoiue  a  les- 
sening of  such  discriminatory  measures  between  the  States,  the 
evil  still  exists,  as  our  retaliatory  statutes  well  attest. 

The  writer  finds  it  difficult  to  understand  how  any  one  familiar 
with  the  manifold  difficulties  and  unnecessary  burdens  and  an- 
noyances to  which  State  supervision  leads  and  who  can  weigh 
this  problem  solely  from  the  standpoint  of  what  is  best  for  the 
business  of  insurance,  looking  at  it,  if  you  please,  not  merely  from 
the  angle  of  the  insurer  but  from  the  angle  of  the  insured,  can 
fail  to  prefer  a  plan,  if  one  be  possible,  which  would  give  us  one 
master  instead  of  many,  which  would  free  us  from  the  iiiultiiude 
of  statutes  ill-advised,  unjust  and  ofttimes  inconsistent  and  which 
would  bring  us  uniformity  in  supervision  and  regulation,  to  say 
nothing  of  relieving  the  business  of  insurance  from  the  excessive 
expense  burdens  which  State  supervision  and  regulation  have  and 
will  place  upon  it. 

This  agitation  against  state  supervision  is  not  one  of  recent 
origin,  nor  has  it  been  confined  to  the  officials  of  insurance  or- 
ganizations. Some  insurance  commissioners  have  strongly  urged  it. 
As  early  as  1865  Mr.  Elizur  Wright,  then  insurance  commissioner 
of  Massachusetts,  in  his  report  for  that  year  strongly  advocated 
Federal  supervision  as  against  State  supervision;  and  the  writer 
listened  to  a  paper  read  before  the  National  Fraternal  Congress 
at  its  annual  session  at  Cambridge  Springs,  Pennsylvania,  in  1911, 
by  Hon.  Arthur  I.  Vorys,  in  which  he  strenuously  argued  in  favor 
of  Federal  supervision  as  against  state  supervision  and  frankly 
stated  that  his  views  upon  the  subject  were  largely  the  result  of 
his  experience  as  the  commissioner  of  insurance  for  the  State  of 
Ohio.  The  question  is  not  one  of  men  nor  of  States,  but  one  of 
principle,  and  should  be  treated  as  such. 

Assuming,  therefore,  that  national  supervision,  if  it  can  be 
obtained,  is  desirable,  is  it  possible"?  This  question  must  be  an- 
swered in  the  negative  under  the  Federal  Constitution  as  it  now 
reads.  The  agitation  for  National  supervision,  however,  has  not 
been  entirely  outside  of  Congress.  The  writer  will  make  no  at- 
tempt to  give  exhaustive  reference  to  the  steps  whicli  have  been 
attempted  in  Congress  to  bring  about  national  supervision.  In  the 
paragraph  creating  the  Bureau  of  Corporations  and  as  a  part  of 
the  bill  under  which  the  Department  of  Commerce  and  Labor  was 
created,  is  found  an  authority  to  that  bureau  under  tlie  direction 
of  the  Secretary  of  Commerce  and  Labor  to  gather,  compile,  pub- 
lish and  supply  useful  information  concerning  corporations  en- 
gaged in  insurance.  It  will  be  noted  that  the  extent  of  the  author- 
ity is  to  gather,  compile,  publish  and  supply  nsofnl  iiifonnalion. 
From  an  erlucational  viewpoint  tliis  jirovision  of  the  act  may  be 
beneficial,  but  it  hardly  extends  beyond  that. 

President  Roosevelt,  in  his  Annual  INIessage  to  the  first  session 
of  the  59th  Congress,  said  to  that  body  on  December  5.  1905,  dis- 
cu.ssing  Federal  supervision  of  insurance: 


WORLD'S  INSURANCE  CONGRESS  317 

"The  burden  upon  insurance  companies,  and  therefore  their 
policyholders,  of  conflicting  regulations  of  many  States  is  unques- 
tionable while  but  little  effective  check  is  imposed  upon  any  evil 
and  unscrupulous  man  who  desires  to  exploit  the  company  in  his 
own  interest  and  at  the  expense  of  the  policyholders  and  the  pub- 
lic, ...  As  a  remedy  for  this  evil  of  conflicting,  ineffective  and 
yet  burdensome  regulations,  there  has  been  for  many  years  a  wide- 
spread demand  for  Federal  supervision." 

After  referring  to  the  provision  with  regard  to  insurance  in  the 
act  creating  the  Bureau  of  Corporations,  the  President  said  fur- 
ther: 

"It  is  obvious  that  if  the  compilation  of  statistics  be  the  limit 
of  Federal  power,  it  is  wholly  ineffective  to  regulate  this  form  of 
commercial  intercourse  between  the  States,  and  as  the  insurance 
business  has  outgrown  in  magnitude  the  possibility  of  State  super- 
vision, the  Congi'ess  should  carefully  consider  whether  further  leg- 
islation can  be  had." 

The  House  of  Representatives,  by  resolution  adopted,  referred 
that  portion  of  the  President's  Message  dealing  with  the  subject  of 
corporations  engaged  in  the  business  of  insurance,  as  well  as  cor- 
porations enga-ged  in  other  lines  of  business,  to  the  Committee  on 
Judiciary  with  directions  to  report  fully  at  an  early  date  their 
views  as  to  the  power  of  the  Federal  Government  to  regulate  or 
control  corporations  in  the  management  or  control  of  such  business. 
This  committee  on  March  23,  1906  (Report  No.  2491)  presented 
its  report  to  the  House  and  in  an  exhaustive  opinion  reached  the 
conclusion  that  under  the  Federal  Constitution  Congress  lacked 
power  to  supervise  and  regulate  the  business  of  insurance. 

Article  X  of  the  Amendments  to  the  Federal  Constitution  reads : 

"The  powers  not  delegated  to  the  United  States  by  the  Consti- 
tution nor  prohibited  by  it  to  the  States,  are  reserved  to  the  States 
respectively  or  to  the  people," 

The  writer  does  not  understand  that  it  has  ever  been  contended 
by  any  one  that  the  business  of  insurance  can  be  supervised  and 
regulated  by  Federal  authority  unless  it  can  be  done  under  the 
commerce  clause  of  the  Constitution,  but  for  more  than  forty-five 
years  the  voice  of  the  Federal  Supreme  Court  has  been  consistently 
saying  that  insurance  is  not  commerce  and  therefore  insurance 
transactions  between  organizations  of  one  State  and  citizens  of 
another  is  not  interstate  commerce. 

Beginning  with  Paul  v.  Virginia  (75  U.S.  168),  decided  in 
1868,  and  prior  to  the  decision  of  that  court  in  the  Deer  Lodge 
County  case,  the  Supreme  Court  gave  expression  to  this  view  in 
at  least  eight  cases.  It  was  thought,  however,  by  many  that  a 
fundamental  error  had  been  made  by  the  court  in  Paul  v.  Virginia 


318       WORLD'S  INSURANCE  CONGRESS 

which  had  continued  through  the  subsequent  cases,  and  that  the 
business  of  insurance  had  reached  such  world-wide  magnitude  and 
now  played  so  important  a  part  in  our  commercial  lite,  that,  ii' 
the  question  could  be  squarely  raised  before  that  great  court  in 
a  case  which  would  present  insurance  as  it  is  to-day,  that  court 
could  be  induced  to  change  its  position  and  to  hold  that  insurance 
is  commerce  and  can  be  regulated  by  the  Federal  Government 
under  the  commerce  clause  of  the  Constitution.  That  hope  could 
hardly  be  longer  indulged  after  the  Supreme  Court  filed  its  opin- 
ion in  New  York  Life  Insurance  Company  v.  Deer  Lodge  County 
(231  U.S.  495)  on  December  15,  1913,  for  in  this  case  the  Supreme 
Court  plainly  stated  that  under  the  doctrine  of  stare  deems  it 
considered  the  question  foreclosed;  but  out  of  respect  for  the 
able  briefs  which  had  been  filed  on  behalf  of  the  company,  the 
court  reconsidered  the  question  on  principle  and  solemnly  an- 
nounced by  a  vote  of  seven  to  two  that  the  previous  decisions  of 
the  court  were  correct.  It  is  true  that  in  this  case  Mr.  Justice 
Hughes  and  Mr.  Justice  Van  Devanter  dissented.  It  may  be 
regretted  that  they  did  not  file  a  dissenting  opinion  expressing 
fully  the  reasons  for  their  dissent.  It  may  be  assumed,  in  view 
of  the  fact  that  the  real  question  in  that  case  was  whether  insur- 
ance is  commerce,  they  were  of  opinion  the  earlier  cases  were 
wrong  and  should  be  overruled.  It  is  the  writer's  belief,  however, 
that  the  fact  that  two  of  the  justices  of  that  court  dissented,  holds 
out  no  hope  that  the  court  will  ever  overrule  these  cases.  The 
court  has  again  solemnly  spoken  and  whatever  may  have  been 
the  view  of  the  two  dissenting  justices,  the  opinion  filed  is  the 
opinion  of  the  court.  There  should  be  certainty  and  stability  in 
the  law.  Courts  are  reluctant  to  overrule  decisions  solemnly  an- 
nounced, although  there  are  many  instances  where  this  has  been 
done.  It  is,  however,  too  much  to  expect  that  after  the  solemn 
declaration  in  the  Deer  Lodge  County  case  this  court  will  ever  re- 
verse its  position  upon  this  question.  The  doctrine  of  stare  decisis 
will  alone  be  sufficient  to  foreclose  this  passibility. 

The  view  has  been  entertained  by  many  that  if  Congress  by 
statute  would  declare  that  insurance  is  commerce,  the  Federal  Su- 
preme Court  would  sustain  the  constitutionality  of  that  statute. 
The  writer  does  not  entertain  that  view.  If  insurance  is  not  com- 
merce, it  cannot  be  made  so  by  a  declaration  by  Congress  that  it 
is  commerce,  nor  can  the  situation  be  changed  by  a  Congressional 
enactment  that  insurance  is  to  be  treated  as  commerce,  for  the  Fed- 
eral Constitution  will  still  stand  in  the  way  and  the  question  will 
be  determined  by  tlie  Supreme  Court,  not  on  the  basis  of  what  Con- 
gress has  said  insurance  is,  but  upon  the  basis  of  what  insurance 
is,  and  that  question  has  been  foreclosed. 

The  only  avenue  for  relief  is  an  amendment  to  the  Federal 
Constitution. 

To  what  extent  should  that  amendment  go?  If  the  Constitution 
should  be  amended  so  as  merelj'  to  authorize  Congress  to  provide 


"WORLD'S  INSURANCE  CONGRESS  319 

for  Federal  supervision  while,  at  the  same  time,  leaving  the  power 
of  supervision  in  the  States,  insurance  now  with  its  forty-eight 
supervisors  would  have  forty-nine  and  it  is  the  \\Titer's  view  that 
this  would  simply  increase  our  trouble.  If  we  are  to  have  National 
supervision  the  Constitution  should  be  so  amended,  if  possible,  as 
to  vest  the  sole  power  of  supervision  in  the  Federal  Government. 

The  w^riter  was  much  interested  in  an  opinion  written  in  July, 
1914,  by  ^Ir.  John  C.  Spooner  to  the  president  of  the  New  York 
Life  Insurance  Company  with  reference  to  the  form  which  an 
amendment  to  the  Federal  Constitution  should  take.  It  was  the 
view  of  that  eminent  constitutional  lawyer  that  an  amendment 
reading  ' '  Congress  shall  have  power  to  regulate  the  business  of 
insurance  throughout  the  United  States,  its  territories  and  pos- 
sessions," would  vest  the  sole  power  of  regulating  insurance  in 
the  Federal  Government,  where  the  writer  thinks  it  properly  be- 
longs. i\Ir.  Spooner  suggested  in  lieu  of  this  amendment  one  which 
would  provide  that  "Congress  shall  have  pow-er  to  regulate  the 
business  in  insurance  by  a  corporation  in  States  other  than  that 
by  which  it  was  created,"  with  the  thought  that  the  latter  amend- 
ment would  more  likely  meet  with  the  approval  of  the  States.  A 
system  of  supervision  which  would  place  all  insurance  other  than 
that  by  a  domestic  company  within  its  home  State  within  the 
regulatory  powers  of  the  Federal  Government  and  which  would 
thus  operate  to  reduce  the  number  of  supervising  departments  from 
forty-eight  to  two  as  to  each  insurance  organization,  would  be  far 
preferable  to  the  present  system.  The  problem  is  not  so  much 
what  should  be  done  as  whether  it  can  be  done,  and,  if  so,  how  to 
go  about  it. 

One  of  the  things  which  stands  in  the  way  is  the  old  idea  of  the 
rights  of  the  States.  An  eminent  fraternalist  from  Richmond, 
Virginia,  discussing  State  v.  Federal  supervision  at  the  last  ses- 
sion of  the  National  Fraternal  Congress  and  arguing  in  favor  of 
State  supervision,  frankly  said  this: 

"If  the  trend  of  this  paper  be  toward  retaining  the  reserved 
rights  of  the  States,  rather  than  extending  the  centralized  power 
of  the  Federal  Government,  it  may  be  due  partly  to  the  fact  that 
the  writer  comes  from  the  South,  Avhere  the  people  are  more  tena- 
cious of  what  is  popularlj'  known  as  *  State 's  Rights, '  yet  it  is  be- 
lieved that  all  over  the  country  there  has  been  in  recent  years  a 
quickening  of  public  opinion  towards  a  retention  of  the  rights  re- 
served to  the  States  without  further  extension  of  the  powers  of 
the  Federal  Government." 

The  writer  has  no  controversy  with  any  one  who  insists  upon 
the  retention  of  the  rights  of  the  States  with  reference  to  those 
matters  which  the  States  can  handle  better  or  even  as  well  as  the 
National  Government,  but  there  should  be  a  sufificient  spirit  of 
nationalism  in  us  all  to  be  willing  to  place  in  the  hands  of  the 
National  Government  the  regulation  and  control  of  those  matters 


320  WORLD'S  INSURANCE  CONGRESS 

which  can  be  better  handled  through  the  National  Government  than 
through  the  governments  of  the  States.  Viewing  it  from  a  prac- 
tical standpoint,  the  writer  is  much  inclined  to  the  view  that  the 
element  in  the  equation  which  will  be  most  difficult  to  overcome 
is  the  disposition  on  the  part  of  the  States  to  use  the  business  of 
insurance  as  a  source  of  revenue,  for  when  the  States  give  over, 
if  they  ever  do,  to  the  Federal  Government  the  power  to  supervise 
and  regulate  insurance,  they  will  surrender  much  of  this  great 
source  of  revenue. 

That  the  task  of  procuring  a  proper  constitutional  amendment 
will  be  one  of  great  difficulty  the  writer  fully  appreciates,  but 
that  it  is  impossible  he  does  not  believe.  It  will  take  time  and 
cost  money  to  educate  our  people  to  the  point  where  the  pressure 
upon  Congress  and  the  legislatures  of  the  States  will  bring  about 
the  necessary  action.  The  place  for  this  educational  work  should 
be,  first,  at  least,  among  those  who  carry  insurance.  Ten  millions, 
it  is  thought,  are  a  conservative  estimate  of  the  number  of  holders 
of  benefit  certificates  of  fraternal  beneficiary  societies  organized 
and  doing  business  in  the  United  States.  The  writer  will  not  un- 
dertake to  venture  a  guess  as  to  the  number  of  holders  of  policies 
issued  by  the  various  kinds  of  insurance  organizations  other  than 
fratemals,  but  it  will  be  ten  millions  several  times  multiplied.  If 
this  vast  army  of  the  insured  can  ever  be  educated  to  realize  the 
benefits  of  National  supervision  as  against  State  supervision,  the 
solution  of  the  problem  will,  from  that  time  on,  be  comparatively 
easy ;  and  so,  therefore,  should  not  our  work  along  educational  lines 
be  directed  primarily  to  those  who  suffer  most  from  State  supervi- 
sion, hence  are  most  to  be  benefited  by  National  supervision. 

In  conclusion  the  writer  wishes  it  to  be  understood  that  the 
views  expressed  in  this  paper  are  merely  his  own.  He  does  not 
speak  for  the  fraternal  beneficiary  system  of  insurance  nor  for 
the  National  Fraternal  Congress  of  America  upon  this  subject. 

At  the  conclusion  of  the  paper  read  by  Mr.  Vorys  before  the 
National  Fraternal  Congress  in  1911,  the  whole  matter  of  Federal 
supervision  was  referred  to  the  committee  on  statutory  laws  of 
the  Congress  for  consideration  during  the  following  year,  with  in- 
structions to  report  at  the  next  session  of  the  Congress  on  the  ad- 
visability of  action.  No  further  action  has  ever  been  taken  by  that 
body. 

NATIONAL  SUPERVISION 

By   Samuel  Davis 
Member,  Boston  Bar 

Mr.  Chairman,  and  Gentlemen  of  the  World's  Insurance  Con- 
gress :  I  much  appreciate  the  opportunity  of  being  here  to  advo- 
cate, even  most  briefly,  a  subject  that  is  very  close  to  my  heart. 


WORLD'S  INSURANCE  CONGRESS  321 

When  I  sat  down  to  prepare  this  brief  paper,  I  realized,  of  course, 
that  it  coming  on  the  last  day  of  the  program  those  faithful 
enough  to  stick  it  out  would  be  weary  of  all  matters  relating  to 
insurance,  and  so  I  made  it  brief,  and  shall  not  attempt  to  give  it 
comprehensive  treatment.  I  assume  every  student  of  insurance  is 
familiar  with  the  present  system  of  State  supervision;  and  also 
with  various  attempts  that  have  been  made  from  time  to  time  to 
have  the  central  government  declare  insurance  to  be  commerce,  and 
thus  bring  it  within  the  power  of  Congress  to  regulate.  I  person- 
ally abandoned  that  opinion  some  time  ago,  and  shall  treat  the 
subject  from  another  angle.  I  have  entitled  my  paper  "Some  ^lis- 
conceptions  of  our  Fundamental  Law  upon  which  Objections  to 
National  Supervision  of  Insurance  Are  Based." 

I  am  prepared  for  something  like  that  "grim  silence  of  fore- 
gone dissent"  with  which  in  the  year  1837  Emerson's  address  on 
the  American  scholar  was  received  by  his  audience,  for  I  am  weU 
aware  that  the  subject  of  Federal  supervision  is  unwelcome  to  a 
considerable  portion  of  the  insurance  profession.  Nevertheless,  its 
achievement  may  be  closer  at  hand  than  we  imagine,  so  I  purpose 
in  this  paper  to  consider  some  misconceptions  of  our  fundamental 
law  which  underlie  the  objections  and  distrust  which  are  enter- 
tained by  some  students  of  supervision  who  fear  to  substitute  na- 
tional control  for  the  present  method  of  State  supervision. 

The  historic  opposition  to  National  supervision  of  insurance  has, 
of  course,  been  developed  entirely  from  our  present  primal  law. 
With  that  law  changed  by  constitutional  amendment,  the  Supreme 
Court  will  no  longer  oppose  National  supervision,  as  it  Avill  be  de- 
prived of  any  ground  for  objection. 

There  is  a  curious  tendency  upon  the  part  of  some  writers  and 
speakers  on  the  proposed  change  to  National  supervision  of  in- 
surance. Those  people  confuse  the  opposition  of  the  Supreme  Court 
to  National  control  under  our  present  law,  with  the  unquestionable 
right  of  the  people  to  change  the  Constitution.  One  speaker,  Dan- 
iel W.  Simms,  Esq.,  in  a  paper  read  at  the  American  Life  Con- 
vention of  last  year  said,  "The  opinion  is  broadspread  among  the 
friends  of  Federal  supervision  that  a  nation-wide  declaration  for 
the  change  will  have  its  influence  on  the  Supreme  Court  event- 
ually." But  we  know  that  the  Supreme  Court  would  be  prompt 
to  deny  a  desire  to  give  any  opinion  whatever  as  to  whether  or  not 
the  Constitution  should  be  changed.  The  sole  business  of  the  Su- 
preme Court  is  to  interpret  the  law  after  it  has  been  made.  All 
the  Supreme  Court  has  ever  said  is  that  under  our  Constitution 
as  it  now  exists,  insurance  is  not  commerce  and  therefore  it  is  i^.ot 
Avithin  the  powor  of  the  National  Government  to  regulate  under 
CI.  5,  Sec.  8  of  Art.  1  of  the  Constitution,  which  provides  that 
Congress  shall  have  power  "to  regulate  commerce  with  foreign 
nations  and  among  the  several  States,  and  wath  the  Indian  tribes. ' ' 

Moreover,  it  cannot  be  said  that  the  court  in  any  way  is  now 


322       WORLD'S  INSURANCE  CONGRESS 

lacking  in  a  complete  understanding  of  all  the  grounds  upon  which 
the  claim  of  insurance  for  recognition  as  commerce  is  based.  For, 
notwithstanding  the  magnificent  brief  prepared  by  the  able  counsel 
of  the  New  York  Life  Insurance  Company  and  his  distinguished 
associates,  made  for  use  in  a  case  based  upon  a  state  of  facts  de- 
liberately chosen  to  present  in  its  most  favorable  light,  the  claim 
of  insurance  as  commerce,  the  court  again  in  December,  1913, 
held  to  its  original  position.^  In  the  course  of  its  elaborate  opin- 
ion in  the  Deer  Lodge  County  Montana  case  the  court  says,  "It  is 
also  urged  that  modern  life  insurance  has  taken  on  essentially  a 
national  and  international  character  and  that  when  Paul  v.  Vir- 
ginia was  decided  the  business  was  '  to  a  great  extent  local ;  that 
is,  conducted  through  the  domestic  contracts  by  stock  companies. 
The  great  and  commanding  organizations  of  the  present  day  had 
hardly  begun  the  amazing  developments  w'hich  have  made  them 
the  greatest  associations  of  administrative  trusts  of  the  business 
world. '  These  contentions  were  earnestlj^  made ;  the  reply  to  them 
deliberately  meditated,  and  its  extent  fully  appreciated." 

That  is  what  the  court  says  in  carefully  chosen  language  and 
with  sufficient  emphasis.  Surely  it  intends  us  to  accept  its  latest 
decision  as  final  and  I  for  one  do  so  accept  it.  That  two  judges 
dissented  in  this  ease  is  of  no  great  importance  inasmuch  as  the 
dissenting  judges  neglected  to  assign  reasons  for  their  dissent. 
This  latest  decision  of  the  Supreme  Court  should  forever  dispose 
of  the  belief  that  any  amount  of  public  opinion  could  eventually 
induce  the  court  to  reverse  itself,  and  in  my  view  it  is  a  miscon- 
ception of  the  fundamental  nature  of  our  government  to  expect 
the  court  to  be  influenced  by  public  opinion  in  construing  the  law 
of  the  land. 

There  is  a  department  of  the  government  which  is  and  should 
be  susceptible  to  public  opinion.  I  mean  the  legislative  depart- 
ment. Having  failed  to  obtain  Federal  supervision  through  the 
aid  of  the  judicial  branch  of  the  government  w^e  are  compelled  to 
enter  a  new  path,  one  which  I  believe  will  lead  to  ultimate  suc- 
cess. I  mean  procedure  by  means  of  an  amendment  to  the  Fed- 
eral Constitution. 

As  no  one  else  came  forward  to  propose  such  an  amendment, 
I  prepared  one  W'hich  was  introduced  in  both  branches  of  the 
National  Legislature  in  the  early  part  of  191-4.  The  amendment 
reads  as  follows: 

"Art.  I,  Sec.  8,  CI.  19.  The  Congress  shall  have  power  to  regu- 
late the  business  or  commerce  of  insurance  throughout  the  United 
States  and  its  Territories  and  possessions." 

The  all  important  question  then  becomes,  would  the  adoption  of 
this  amendment  give  us  a  single  regulating  power  over  insurance. 


WORLD'S  INSURANCE  CONGRESS       323 

or  would  it  merely  add  another  body  to  the  existing  forty-eight 
regulating  authorities?  My  answer  is  that  Congress  would  be 
supreme,  and  that  all  power  to  regulate,  license  or  control  insur- 
ance corporations  would  be  taken  from  the  States,  and  I  will  now 
attempt  to  correct  a  widespread  misconception  on  this  point. 

In  the  Minnesota  rate  decisions  of  1913  -  the  Supreme  Court 
with  much  clearness  set  forth  the  relation  existing  between  the 
State  and  Nation  over  matters  of  concurrent  or  conflicting  juris- 
diction. It  said,  "The  power  of  Congress  to  regulate  commerce 
among  the  several  States  is  supreme  and  plenary,  it  is  complete  in 
itself,  may  be  exercised  to  its  utmost  extent  and  acknowledges  no 
limitations  other  than  are  prescribed  in  the  Constitution."  Long 
before  the  Minnesota  rate  cases.  Chief  Justice  Marshall  had  said, 
"There  is  no  room  in  our  scheme  of  government  for  the  assertion 
of  State  power  in  hostility  to  the  authorized  exercise  of  Federal 
power."  And  as  late  as  December,  1913,  in  the  Deer  Lodge 
County  case^  the  court  remarks,  "We  have  already  pointed  out 
that  if  insurance  is  commerce  and  becomes  interstate  commerce 
whenever  it  is  between  citizens  of  different  States,  then  all  con- 
trol over  it  is  taken  from  the  States  and  the  legislative  regulations 
which  this  court  has  heretofore  sustained  must  be  declared  in- 
valid." 

The  decisions  in  the  Minnesota  rate  cases  and  the  Shreveport 
rate  ease  *  show  clearly  that  the  power  of  Congress  in  the  regula- 
tion of  insurance  would  be  supreme  even  under  our  present  sys- 
tem of  State  charters. 

But  in  order  to  render  unnecessary  any  fresh  adjudication  of 
the  boundaries  of  State  and  Federal  control — even  in  the  case  of 
the  single  State  incorporating  the  insurance  company — I  propose 
that  the  companies  exchange  their  present  State  charters  for  fresh 
charters  to  be  granted  by  Congress,  which  body  has  frequently 
in  the  past  exercised  its  right  to  grant  charters  of  incorporation. 
The  National  Government  will  then  be  engaged  in  regulating  cor- 
porations of  its  own  creating  rather  than  the  offspring  of  the 
forty-eight  States. 

Mr.  Morawetz  °  argues  that  if  interstate  commerce  cannot  be 
carried  on  in  an  orderly  manner  and  with  safety  to  the  public 
by  a  multitude  of  corporations  organized  under  the  diverse  and 
varying  legislation  of  forty-eight  different  States,  it  would  seem 
justifiable  under  the  power  to  regulate  interstate  commerce  to  re- 
quire all  such  corporations  engaging  in  such  commerce  to  comply 
with  any  appropriate  regulations  for  the  protection  of  the  public 
and  also  to  confer  upon  all  corporations  complying  with  the  pre- 
scribed regulations  a  legal  right  or  franchise  to  carry  on  their 
interstate  commerce  throughout  the  United  States  free  from  re- 
strictions imposed  by  the  several  States. 

Just  as  we  now  have  the  First  National  Bank  of  Des  Moines, 


324  WORLD'S  INSURANCE  CONGRESS 

or  the  Second  National  Bank  of  Milwaukee,  United  States  insti- 
tutions in  every  element  and  detail  of  their  organization,  though 
conducted  and  maintained  locally,  with  National  charters  for  in- 
surance companies,  we  would  soon  become  familiar  with  such  names 
as  the  Prudential  National  Life  of  Newark,  the  National  Standard 
Accident  Insurance  Company  of  Detroit,  the  Continental  National 
Fire  of  New  York,  the  New  England  National  Life  of  Boston,  and 
others.  The  local  character  of  these  institutions  will  in  nowise 
be  lost,  but  all  will  be  under  one  law,  one  supervising  government, 
and  subject  to  one  court  of  final  appellate  jurisdiction,  the  Supreme 
Court  of  the  United  States. 

To  predict  this  change  from  time-honored  methods  is  not  vision- 
ary, not  a  mere  flight  of  fancy.  The  time  when  it  will  become 
an  accomplished  fact  may  be  said  to  be  almost  within  sight. 
Though  a  long  time  in  preparation  (nearly  half  a  century),  the 
forces  which  will  bring  Federal  supervision  to  pass  are  about  to 
cubninate. 

Already  the  ^Massachusetts  legislature  during  the  present  year 
adopted  a  joint  resolution  which  petitions  Congress  to  propose  to 
the  several  States  of  the  Union  for  their  adoption  an  amendment 
to  the  Federal  Constitution  which  shall  empower  Congress  to 
grant  charters  to  business  corporations  of  all  kinds  engaged  in 
interstate  trade,  though  I  question  whether  such  an  amendment 
is  necessary. 

But  even  if  the  companies  for  a  long  time  to  come  should  retain 
their  State  charters,  it  is  quite  certain  that  the  States  could  not 
retain  any  power  of  regulation  after  Congress  acts. 

However,  for  the  future  consideration  of  those  who  think  that 
Federal  control  would  not  oust  the  States  from  all  jurisdiction 
over  insurance,  I  direct  attention  to  the  status  of  National  banks 
under  our  Federal  and  our  State  laws.^  As  every  one  knows,  Na- 
tional banks  are  local  institutions,  all  of  them  being  strongly  iden- 
tified with  the  communities  in  which  they  exist.  One's  friends  and 
neighbors  are  the  officials  and  employees  of  these  banks.  Neither 
the  municipality  nor  the  State  can  exercise  any  control  whatever 
by  way  of  taxing,  regulating  or  dominating  them,  either  by  the 
exercise  of  the  power  of  taxation  or  of  the  police  power,  except 
that  property  within  the  jurisdiction  of  the  municipality  and 
State  may  be  taxed,  because  of  permissive  legislation  by  Congress. 
A  leading  ease  ^  defines  the  position  of  National  banks  in  this 
language:  "National  banks  are  instrumentalities  of  the  Federal 
Oovernment  created  for  a  public  purpose  and  as  such  are  necessar- 
ily subject  to  the  paramount  authority  of  the  United  States.  It 
follows  that  an  attempt  by  a  State  to  define  their  duties  or  control 
the  conduct  of  their  affairs  is  absolutely  void  wherever  such  at- 
tempted exercise  of  autliority  expressly  conflicts  with  the  laws  of 
the  United  States  and  either  frustrates  the  purpose  of  the  National 


WORLD'S  INSURANCE  CONGRESS  325 

legislation  or  impairs  the  efficiency  of  these  agencies  of  the  Federal 
Government  to  discharge  the  duties  for  the  performance  of  which 
they  were  created.  These  principles  are  axiomatic  and  are  sanc- 
tioned by  the  repeated  adjudications  of  this  court."  Can  it  be 
questioned  then,  that  insurance  companies  operating  under  char- 
ters granted  by  the  National  Government  would  be  as  much  pro- 
tected from  local  molestation  as  the  National  banks?  Can  the 
doubting  Thomases  ask  for  any  stronger  assurance  ?  Furthermore, 
if  my  amendment  were  to  be  adopted,  Congress  probably  could 
through  taxation  compel  the  retirement  of  purely  intra-state  or 
local  insurance  companies.^ 

A  well-known  editor^  writes:  "The  principles  for  the  exercise 
of  the  police  power  (by  the  State)  are  infinitely  more  numerous 
and  of  larger  scope  in  the  case  of  insurance  than  in  that  of  inter- 
state commerce.  How,  for  instance,  would  Mr,  Davis  go  about 
providing  that  the  so-called  Robertson  law  in  Texas  requiring  life 
insurance  companies  to  invest  within  the  State  moneys  collected 
by  them  from  the  citizens  of  the  State  is  not  a  valid  exercise  of 
the  police  power?"  The  propounder  of  this  question  assumes 
analogy  which  does  not  exist.  He  supposes  that  State  to  have  the 
power  to  question  the  right  of  the  insurance  company  to  be  within 
the  borders  of  the  State.  He  is  undoubtedly  thinking  of  that 
other  unfortunate  rule  of  law  made  by  the  court  in  Paul  v.  Vir- 
ginia," which  deprived  every  corporation  of  those  rights  of  citizen- 
ship outside  the  State  of  its  domicile,  which  are  secured  to  nat- 
ural persons  by  Sec.  2  of  Art.  IV  of  the  Federal  Constitution. 
But  an  insurance  company  possessing  a  National  charter  granted 
by  the  constitutional  authority  of  the  Federal  Government  is  on 
Federal  territory  and  therefore  not  subject  to  local  interference. 
The  State  of  Texas  would  have  no  more  success  in  attempting  to 
enforce  the  Robertson  law  against  a  company  so  chartered  than  did 
the  State  of  Maryland  in  its  attempt  to  tax  the  United  States 
Bank,  which  effort  resulted  in  the  famous  decision  of  the  United 
States  Bank  v.  McCulloch.^^  It  is  true  that  Congress  has  not  al- 
ways exercised  the  powers  conferred  upon  it  by  the  Federal  Gov- 
ernment. Where  Congress  has  been  silent,  the  States  have  been 
permitted  to  establish  police  regulations.  These  acts  have  not  been 
questioned  until  Congress  proceeded  to  exercise  its  power.  State 
regulations  then  at  once  ceased  to  be  valid,  as  was  so  clearly  and 
elaborately  explained  in  the  Minnesota  rate  cases.^-  In  an  earlier 
case  ^^  the  court  had  said:  "Against  the  National  will,  the  States 
have  no  power  by  taxation  or  otherwise  to  retard,  impede,  burden 
or  in  any  manner  control  the  operation  of  the  constitutional  laws 
enacted  by  Congress  to  carry  into  execution  the  power  vested  in 
the  general  government."  The  State  cannot  through  the  exercise 
of  its  police  power  for  any  purpose  whatever  encroach  upon  iht 
powers  of  the  general  government  or  the  rights  granted  or  secured 


326       WORLD'S  INSURANCE  CONGRESS 

by  the  supreme  law  of  the  land.^*  The  Fourteenth  Amendment 
to  the  Federal  Constitution  is  always  invoked  to  protect  the  States 
against  Federal  encroachment,  but  this  Amendment  itself  is  ca- 
pable of  an  interpretation  subjecting  all  State  legislation  to  a 
Federal  control  nearly  equal  in  scope  to  that  now  exercised  by 
the  State  courts  and  of  course  superior  to  the  latter/^  Professor 
Freund  further  points  out  that  by  interpreting  the  Federal  power 
as  exclusive,  the  Supreme  Court  has  made  it  possible  to  annual 
state  legislation  relating  to  commerce  even  without  the  aid  of 
Congressional  action. 

If  the  authorities  I  have  cited  are  accepted,  it  surely  ought 
to  be  realized  that  the  Federal  Government  once  given  proper 
authority  will  have  supreme  and  exclusive  control  over  the  busi- 
ness or  commerce  of  insurance. 

The  more  the  subject  of  Federal  regulation  of  insurance  is  con- 
sidered by  those  who  are  indifferent  or  lukewarm  to  the  proposi- 
tion and  who  are  loth  to  believe  that  insurance  may  be  relieved 
from  the  most  grievous  of  the  burdens  it  now  sustains,  the  greater 
will  be  the  number  converted  to  the  proposal.  For  the  encourage- 
ment of  these  and  with  the  hope  of  increasing  their  number,  the 
following  quotation  may  be  taken  from  the  Employers'  Liability 
Cases  ^^  to  show  how  the  Supreme  Court  interprets  the  power  of 
Congressional  regulation : 

'^  'To  regulate,'  in  the  sense  intended,  is  to  foster,  protect,  con- 
trol mid  restrain,  with  appropriate  regard  for  the  welfare  of  those 
who  are  immediately  concerned  and  all  the  public  at  large.'" 

This  statement  by  the  United  States  Supreme  Court  should  be 
most  reassuring  as  to  the  attitude  of  the  National  Government 
when  once  control  of  insurance  is  given  to  it  by  Constitutional 
Amendment. 

Whether  or  not  the  attainment  of  such  a  Constitutional  Amend- 
ment is  possible  is  quite  another  question  and  one  entirely  open 
to  debate  and  concerning  which  I  may  be  the  one  who  labors  under 
a  misconception.  I  have  never  contended  that  such  a  change  in 
the  Constitution  would  be  easily  obtained.  On  the  contrary,  there 
is  little  question  of  tlie  great  difficulty  to  be  encountered.  I  do, 
however,  believe  in  the  possibility  of  ultimately  so  changing  our 
basic  law  in  response  to  a  notable  demand  for  such  a  change,  and 
it  is  our  business  to  develop  the  demand. 

A  Weekhf  Underwriter  editorial  ^'  sometime  since  quoted  i\Ir. 
Simms  as  follows:  "We  look  in  vain  for  any  tendency  or  dispo- 
sition here  upon  the  part  of  the  people  to  increase  the  power  of  the 
Federal  Government  by  minimizing  their  own."  Apparently  Mr. 
Simms  has  not  looked  carefully  enough.     There  are  many  signifi- 


WORLD'S  INSURANCE  CONGRESS  327 

cant  tendencies  which  he  might  observe  were  he  not  like  many 
others  so  much  predisposed  to  regard  a  Constitutional  Amendment 
as  impossible  of  attainment.  There  are  numerous  indications  here 
and  there  which  at  least  show  that  people  generally  are  becoinirjr 
aware  of  the  enormous  economic  loss  and  the  friction  which  are 
occasioned  by  so  many  conflicting  governmental  jurisdictions. 

An  important  instance  is  the  action  of  the  Republican  State 
Convention  held  in  Worcester,  Mass.,  on  October  3,  1914.  This 
convention  by  a  unanimous  vote  adopted  a  plank  in  the  party 
platform  favoring  ' '  Such  changes  in  the  Federal  Constitution  and 
laws  as  are  necessary  to  secure  National  charters  for  interstate 
corporations."  Is  there  any  business  whose  operations  and  con- 
duct are  so  necessarily  interstate  as  insurance? 

Again,  Charles  T.  Terry,  President  of  the  conference  of  com- 
missioners on  uniform  State  laws,  in  an  elaborate  review  of  pres- 
ent conditions  said,  "If  we  are  to  be  and  remain  a  Nation,  the 
rights  of  citizens  must  be  clear  and  uniform  throughout  the  va- 
rious sections  of  this  countr^^  so  far  as  those  rights  are  of  an  inter- 
state nature.  Either  this  or  our  system  of  government  is  a  fail- 
ure. ' '  ^^^  He  adds,  ' '  The  business  world  is  wearied  with  the  har- 
assing taxation  of  different  jurisdictions  upon  the  same  subject; 
the  conflict  of  jurisdiction  has  become  accentuated  in  many  direc- 
tions and  unless  the  people  can  be  convinced  that  the  breaking 
down  of  our  theory  of  State  and  Federal  legislation  will  in  the 
end  prove  disastrous  to  well-ordered  liberty,  the  end  of  State  jur- 
isdiction on  many  matters  of  social  and  business  importance  will 
not  be  long  delayed."  ^^ 

So  also,  the  New  England  Grocer  and  Tradesman  recently 
printed  an  article  on  food  laws  with  this  caption:  "Wholesale 
Grocers  Advocate  Federal  Control,"  ^^  and  an  Associated  Press 
dispatch  reported  the  President  of  the  American  Meat  Packers 
Association  as  predicting  that  every  industry  in  the  country 
would  sometime  be  under  Federal  r-upervision.^^  No  search  has 
been  made  to  discover  instances  of  dissatisfaction  with  the  com- 
plications which  arise  from  the  regulation  by  the  States  of  inter- 
state matters.  These  few  illustrations  simply  have  happened  to 
attract  my  attention. 

I  am  convinced  that  much  thought  in  quiet  studies  is  being  given 
to  the  expense  and  loss  of  effort  involved  in  maintaining,  in  our 
day  of  quick  communication  and  travel,  local  governments  over  a 
citizenship  which  in  a  large  and  ever  increasing  part  is  not  local 
in  interest,  in  property  or  in  social  life.  Professor  Gray  of  Har- 
vard is  one  of  these.  He  pays  his  respects  to  the  injustice  which 
arises  out  of  the  opposing  views  on  the  administration  of  trust 
incomes  by  neighboring  States,  in  the  following  language:  "Now 
I  am  not  here  considering  any  practical  advantages  resulting  from 
this  state  of  things  nor  how  far  it  is  the  natural  and  necessary 


328       WORLD'S  INSURANCE  CONGRESS 

consequence  of  our  complex  form  of  government.  But  certainly 
from  a  scientific  point  of  view  nothing  could  be  more  shocking 
It  seems  a  recurrence  of  barbarism,  to  the  times  when  Burgundians, 
Visigoths  and  Romans  living  beside  each  other  had  their  own  sepa- 
rate and  tribal  laws."^^ 

We  may  reasonably  feel  that  it  is  only  a  question  of  time  when 
the  States  of  our  Union  will  be  invited  by  Congress  to  adopt  this 
or  a  similar  Constitutional  Amendment. 

The  absence  of  a  time  limit  in  which  must  be  obtained  the 
needed  36  aflfirmative  votes  of  the  States  is  greatly  to  our  a ": 
vantage.  The  favorable  action  of  a  single  State  should  content 
us  during  the  first  year  of  the  agitation.  The  greatest  and  most 
important  step  of  all  has  been  taken  when  a  beginning  is  made. 
To  gather  in  the  remaining  States  becomes  then  merely  a  matter 
of  time  and  effort.  We  may  assure  ourselves  that  in  this  campaign 
we  will  not  be  fighting  the  wind.  All  work  Avill  count  towards  the 
desired  result. 

In  conclusion  I  must  say  that  I  have  never  felt  impatient  with 
the  United  States  Supreme  Court  for  discharging  its  duty  in  in- 
terpreting our  present  Constitution  according  to  the  best  light  and 
understanding  its  members  could  apply  to  the  issue.  After  all,  it 
was  hardly  fair  to  put  upon  the  Supreme  Court  the  responsibility 
of  re-making  our  constitution  on  this  point.  That  function  and  the 
responsibility  of  performing  it  belong  to  our  great  national  citi- 
zenry. It  is  my  deliberate  conclusion,  arrived  at  after  such  con- 
sideration, that  the  country  will  sometime  discharge  the  duty  it 
owes  to  its  people  by  relieving  the  great  business  or  commerce  of 
insurance  from  an  annual  burden  of  approximately  $20,000,000  in 
taxes  and  impositions  and  the  loss  of  time  and  energy'  at  present 
required  in  complying  with  the  diverse  and  independent  require- 
ments of  forty-eight  governments. 

And  now,  before  concluding,  let  me  read  to  you  from  the  Fn-]  • 
teenth  Amendment  to  the  Constitution  of  the  United  States : 

"All  persons  born  or  naturalized  in  the  United  States  and  sub- 
ject to  the  jurisdiction  thereof,  are  citizens  of  the  United  States 
and  of  the  State  where  they  reside.  No  State  shall  make  or  en- 
force any  law  which  shall  abridge  the  privileges  or  immunities  of 
citizens  of  the  United  States ;  nor  shall  any  State  deprive  any  per- 
son of  life,  liberty  or  property  without  due  process  of  law.  nor 
deny  to  any  per.son  within  its  jurisdiction  the  equal  protection  of 
the 'law." 


WORLD'S  INSURANCE  CONGRESS  329 


References 

1.  New  York  Life  Insurance  Company  v.  Deer  Lodge  County, 
231  U.  S.  495. 

2.  Simpson  v.  Shepard,  230  U.  S.  352. 

3.  New  York  Life  v.  Deer  Lodge  County,  supra. 

4.  234  U.  S.  343. 

5.  XXVI  Harvard  Law  Review,  667  (June,  1913). 

6.  Owensboro  National  Bank  v.  Owensboro,  173  IT.  S.  664. 

7.  Davis  v.  Elmira  Savings  Bank,  161  U.  S.  283. 

8.  Veasie  Bank  v.  Fenno.,  8  Wall.  553 ;  MeCray  v.  United  States, 
195  U.  S.  27  (1903). 

9.  Market  World  and  Chronicle,  Vol.  VIII,  No.  7,  p.  206. 

10.  8  Wall.  168. 

11.  4  Wheaton  316. 

12.  Simpson  v.  Shepard,  supra. 

13.  Farmers'  National  Bank  v.  Dearing,  91  U.  S.  34. 

14.  20  Case  and  Comment,  210,  citing  New  Orleans  Gas  Light 
Co.  V.  Louisiana,  etc.,  115  U.  S.  650;  Morgan's  v.  Board  of  Health, 
118  U.  S.  455 ;  Henderson  v.  New  York,  92  U.  S.  259 

15.  Freund  on  Police  Power,  65. 

16.  Second  Employers'  Liability  Cases,  223  U.  S.  1. 

17.  Vol.  XCL  16   (October  17,  1914). 

18.  New  York  Times,  August  3,  1913. 

19.  lUd. 

20.  January  23,  1914. 

21.  Boston  Evening  Transcript,  October  19,  1914. 

22.  Nature  and  Sources  of  Law,  214. 


NATIONAL  SUPERVISION 

By  Charles  F.  Coffin 
Vice  President,  State  Life  Insurance  Company 

I  wish  to  present  a  condition  rather  than  to  make  an  argument. 

There  lie  before  me,  as  I  write,  three  extraordinary  papers  on  the 
subject  of  National  or  Federal  supervision  of  insurance. 

The  earliest  of  them  was  delivered  at  a  meeting  of  the  Boston 
Life  Underwriters'  Association  in  1904  by  the  late  Mr.  John  F. 
Dryden,  the  then  President  of  the  Prudential  Insurance  Company 
of  America.  The  writer,  a  man  of  great  ability  and  wide  expe- 
rience, admittedly  held  a  brief  for  National  supervision.  It  would 
be  difficult  to  find  anywhere  else  a  clearer  or  more  forceful  state- 
ment of  the  evils  and  inconveniences  resulting  from  State  super- 
vision, whether  relating  to  evils  then  existent  or  that  would  likely 


330       WORLD'S  INSURANCE  CONGRESS 

come  to  pass;  and  it  is  quite  certain  that  nowhere  else  will  there 
be  found  so  hopeful  a  view  of  the  early  adoption  of  National  super- 
vision. One  brief  paragraph  of  the  address,  illustrative  of  this 
point  of  view,  is  as  follows: 

"The  time  is  near  when  favorable  Congressional  action  may  be 
expected  to  put  an  end  to  what  has  become  an  intolerable  situation 
to  the  insurance  companies." 

That  was  eleven  years  ago. 

The  second  of  these  papers  was  delivered  at  a  meeting  of  the 
Association  of  Life  Insurance  Presidents  in  December,  1913,  nine 
years  after  the  first,  by  Hon.  Burton  Mansfield,  Insurance  Com- 
missioner of  the  State  of  Connecticut.  And  for  a  careful,  judicial, 
painstaking  examination  of  the  subject,  pro  and  con,  this  address 
is  without  a  superior. 

The  subject  is  broadly  considered  from  the  standpoint  of  ad- 
vantages, disadvantages  and  obstacles.  The  advantages  of  National 
supervision  are  as  clearly  and  forcibly  set  out  as  are  the  disadvan- 
tages of  State  supervision  in  the  first  of  these  papers.  The  elimi- 
nation of  over  and  conflicting  legislation,  undue  expense  and  ex- 
cessive taxation,  the  securing  of  a  uniform  insurance  code,  the 
adoption  of  one  official  report,  one  official  examination,  the  avoid- 
ance of  duplicate  printed  matter,  the  establishment  of  a  single 
source  of  information  to  the  policyholders,  of  a  single  and  uni- 
form method  of  valuing  life  insurance  policies,  a  more  consistent 
and  scientific  method  of  taxation,  the  abandonment  of  the  present 
vindictive  system  of  retaliatory  legi-slation  on  the  part  of  one 
State  against  the  statutory  requirements  of  other  States  and  the 
ultimate  result  of  uniform  judicial  decisions  of  the  courts  of  the 
various  States  touching  life  insurance  questions,  these  and  pos- 
sibly some  other  supposed  advantages  are  distinctly  enumerated, 
and  plausibly  advocated. 

The  disadvantages  set  out.  though  not  in  all  cases  personally 
endorsed,  include  the  fear  that  a  single  department  would  be  more 
easily  influenced  and  more  readily  swayed  by  a  select  coterie  of 
men  working  together  for  that  purpose,  that  a  single  department 
could  be  brought  more  easily  under  political  control,  that  the 
present  opportunity  of  withdrawing  from  a  State  as  a  relief  from 
iniquitous  legislation  or  official  oppression  would  be  swept  away 
and  that  National  supervision  of  many  other  business  interests 
would  of  necessity  follow  National  supervision  of  insurance. 

The  enumeration  and  consideration  of  the  obstacles  to  National 
supervision  constitute,  perhaps,  the  most  valuable  and  suggestive 
part  of  the  paper.  The  obstacles  are  classified  as  the  practical, 
the  political  and  the  legal,  and  it  is  frankly  stated  that  the  obstacles 
to  National  super^nsion  do  not  so  readily  yield  to  reason  as  the 
disadvantages  named.     The  writer  expresses  his  own  preference 


WORLD'S  INSURANCE  CONGRESS  331 

for  National  supervision  in  the  place  of  State  supervision,  but 
does  not  indulge  any  strong  hope  for  the  change.  In  discussing 
the  obstacles  to  National  supervision,  he  makes  a  good  deal  of  the 
question  of  the  growth  of  State  power  which  has  become  so  firmly 
established,  these  latter  times,  and  significantly  says : 

"It  would  seem  as  if  from  this  point  of  view  there  were  to-day 
less  chance  for  the  introduction  of  Federal  supervision  than  there 
was  half  a  century  ago." 

Of  the  probability  of  securing  National  supervision  by  means  of 
an  amendment  to  the  Constitution  of  the  United  States,  the  writer 
gives  his  opinion  in  a  single  sentence,  as  follows: 

"The  people  of  the  United  States  are  not  going  to  amend  the 
Constitution  just  to  bring  about  Federal  supervision  of  insur- 
ance. ' ' 

The  third  paper  of  the  trilogy  heretofore  referred  to  was  de- 
livered before  the  American  Life  Convention  in  October,  1914.  h^ 
Dan  W.  Simms,  General  Counsel  of  the  Lafayette  Life  Insurance 
Company,  and  is  an  avowed  and  forceful  argument  against  the 
desirability,  even  the  practical  possibility,  of  National  supervision 
being  achieved  by  any  means  whatsoever.  The  opening  paragraph 
of  this  paper  is  comprehensive,  not  to  say  sweeping,  and  is  as 
follows : 

"If  every  insurance  company,  every  policyholder  and  every  in- 
surance organization  in  the  United  States  were  agreed  in  a  demand 
for  exclusive  Federal  supervision;  if  Senator  and  Representative 
of  the  Federal  Congress  had  voted  as  a  unit  upon  the  passage  of 
such  a  law,  committing  the  whole  subject  of  life  insurance  to  Fed- 
eral supervision,  to  the  exclusion  of  State  supervision,  and  the 
President  of  the  United  States  had  affixed  his  signature  to  the 
bill,  we  should  yet  be  no  nearer  exclusive  Federal  supervision  than 
we  are  to-day." 

The  paper,  as  a  whole,  is  a  masterly  one.  It  was  written  by  a 
lawyer,  primarily  for  lawyers,  and  is  consequently  devoted  in  large 
part  to  an  examination  of  the  decisions  of  the  Supreme  Court  of 
the  United  States  on  the  subject  of  the  relation  of  insurance  to 
commerce.  As  a  collection  and  analysis  of  the  decisions  of  this 
court  of  last  resort  on  this  interesting  topic,  the  paper  leaves  noth- 
ing to  be  desired. 

One,  wishing  to  make  a  thorough  study  of  the  subject  of  National 
supervision  in  all  of  its  ramifications,  cannot  do  better  than  begin 
by  a  careful  examination  of  these  three  papers.  Practically  every 
difficulty  of  State  supervision  and  every  supposed  advantage  of 
National  supervision,  and  every  obstacle  to  National  supervision 
are  set  out  in  extenso.     Besides,  these  papers  constitute  a  notable 


332       WORLD'S  INSURANCE  CONGRESS 

and  valuable  summary  of  the  history  of  the  agitation  for  National 
supervision  during  the  past  tifty  years. 

As  it  is  my  purpose  to  make  this  a  so-called  practical  paper, 
rather  than  an  argumentative  one,  I  feel  that  the  greatest  service 
I  can  render  to  the  real  students  of  the  subject  under  discussion 
is  to  emphasize  the  value  of  these  papers  and  to  commend  them  to 
those  who  may  not  have  read  them.  After  a  careful  study  of  those 
addresses  and  of  all  the  available  literature  on  the  subject  and, 
taking  into  consideration  the  fact  that  the  agitation  for  National 
supervision  of  insurance  has  been  in  progress  for  more  than  half 
a  century  and  that  it  has  had  for  its  champions  some  of  the  ablest 
men  the  country  has  produced,  one  will  be  compelled  to  the  con- 
clusion that  the  progress  from  State  toward  National  supervision 
has  been  insignificant.  We  may  have  thought  that  we  were 
marching,  but  we  were  only  marking  time.  Personally,  I  am 
firmly  of  the  opinion  that  we  are  substantially  farther  away  from 
National  supervision  to-day  than  it  appeared  we  were  two  years 
ago ;  that  what  might  be  termed  the  high  tide  of  opinion  in  favor 
of  National  supervision  was  reached  about  that  time;  and  that 
then  a  strong  countereurrent  of  opinion  set  in  and  has  been  gath- 
ering force  ever  since.  The  decision  in  the  Deer  Lodge  case,  the 
clear  and  logical  addresses  of  Commissioner  Mansfield  and  Mr. 
Simms,  widely  read  as  they  have  been,  and  the  subsequent  unani- 
mous adverse  action  of  the  American  Life  Convention,  an  organi- 
zation composed  of  one  hundred  legal  reserve  life  insurance  com- 
panies, domiciled  in  thirty-three  States,  have  had  much  to  do  with 
this  change  of  view  and  have  no  doubt  driven  home  to  many 
thoughtful  minds  the  conviction  that  National  supervision  of  in- 
surance, after  all,  is  largely  an  academic  question. 

If  National  supervision  shall  ever  displace  State  supervision  it 
must  wait  until  the  Supreme  Court  of  the  United  States  shall  re- 
verse its  numerous  decisions  that  insurance  is  not  commerce  nor 
an  instrumentality  of  commerce  and  therefore  is  not  subject  to 
supervision  at  the  hands  of  Congress ;  or,  it  must  abide  the  adop- 
tion, ratification  and  the  judicial  sanction  of  an  amendment  to  the 
Constitution  of  the  United  States,  giving  Congress  the  exclusive 
authority  to  supervise  the  business  of  insurance.  It  is  unlikely 
that  the  youngest  man  here  will  so  nearly  approach  the  age  of 
Methuselah  as  to  behold  the  consummation  of  either  one  of  these 
events. 

What  is  there  in  the  decision  of  the  Supreme  Court  from  the 
case  of  Paul  v.  Virginia,  determined  in  18fI8,  to  the  Deor  Lodge 
case,  decided  in  1914.  that  affords  any  ray  of  hope  that  this  court 
will  ever  judicially  declare  insurance  to  be  commerce?  Over  and 
over  again  has  the  court  held  to  the  contrary,  each  time,  if  pos- 
sible, announcing  its  views  with  jrreator  vigor  and  elaboration  than 
in  the  former  cases,  and  finally  extending  those  views  so  as  to  cover 
the  whole  realm  of  insurance  business,  fire,  life,  marine  and  casu- 


WORLD'S  INSURANCE  CONGRESS  333 

alty.  The  very  latest  direct  expression  of  this  tribunal,  as  set  out 
in  the  now  celebrated  Deer  Lodge  case,  involved  a  careful  con- 
sideration of  all  previous  cases — a  consideration  and  examination 
made  out  of  special  deference  to  the  ability  and  earnestness  of 
counsel — and  as  a  result  of  this  searching  and  analytical  review 
of  past  decisions,  the  court  reached,  if  possible,  a  more  irrevocable 
affirmation  of  the  doctrine,  that  insurance  is  not  commerce  and 
therefore  cannot  be  controlled  by  congressional  legislation,  than 
had  been  announced  in  any  previous  case.  It  does  not  seem  at  all 
likely  that  the  United  States  Supreme  Court  will  ever  reverse  that 
decision. 

The  more  recent  case  of  Thames  and  Mersey  Marine  Insurance 
Company  v.  United  States,  decided  April  5,  1915,  at  first  blush 
may  appear  to  announce  a  different  doctrine.  This  case  declared 
invalid  the  stamp  tax  under  the  War  Revenue  Act  of  June  13, 
1898,  upon  marine  policies  insuring  cargoes  against  the  hazards 
of  the  sea  during  the  voyage  from  State  ports  to  foreign  ports, 
as  being  in  substance  a  tax  upon  exportation  and  hence  contrary 
to  the  United  States  Constitution,  prohibiting  any  tax  or  duty 
on  articles  exported  from  any  State.  This  decision,  on  a  super- 
ficial reading,  seems  to  hold  that  a  policy  of  marine  insurance 
cannot  be  taxed  for  the  reason  that  such  a  policy  is  a  necessary 
instrumentality  of  commerce,  and  in  such  an  event  the  decision 
certainly  would  be  in  conflict  with  the  case  of  Paul  v.  Virginia, 
Some  of  the  advocates  of  the  doctrine  that  insurance  is  commerce 
have  naturally  and  quickly  seized  upon  this  decision  as  an  indi- 
cation that  in  time  the  Supreme  Court  will  be  compelled  to  reverse 
itself  and  to  hold  that  insurance  is  commerce.  But  a  closer  exam- 
ination of  what  the  court  actually  decided  and  of  the  careful  way 
in  which  the  insurance  cases  were  referred  to  and  distinguished 
will  render  it  very  certain  not  only  that  the  views  of  the  Supreme 
Court  have  undergone  no  change,  but  that  no  change  is  at  all  to 
be  hoped  for. 

And  upon  what  theoiy  indeed  is  it  even  supposed  that  any 
change  will  occur  and  that  a  reversal  of  the  case  of  Paul  v.  Vir- 
ginia and  of  the  subsequent  case  can  ever  be  had?  Is  it  because 
the  business  has  grown  to  such  an  enormous  extent?  Because 
it  has  become  really  national  ?  Is  it  because  it  is  so  closely  related 
to  gi-eat  financial  interests  of  every  kind  and  that  the  business  of 
insurance  has  been  extended  in  a  way  and  to  a  degree  never 
dreamed  of  at  the  time  of  the  celebrated  decision  of  Paul  v.  Vir- 
ginia? These  seem  to  be  the  main  reasons  for  the  hope  of  those 
who  still  think  relief  may  be  had  through  the  Supreme  Court. 
About  eleven  years  ago  the  President  of  the  United  States  in  his 
annual  message  to  Congress  said : 

''The  business  of  insurance  vitally  affects  the  great  mass  of 
the  people  of  the  United  States,  and  is  national  and  not  local  in 
its  application.    It  involves  a  multitude  of  transactions  among  the 


334       WORLD'S  INSURANCE  CONGRESS 

people  of  the  different  States  and  between  American  companies 
and  foreign  governments.  I  urge  that  Congi-ess  carefully  con- 
sider whether  the  power  of  the  Bureau  of  Corporations  cannot 
constitutionally  be  extended  to  cover  interstate  transactions  in 
insurance." 

But  the  Supreme  Court  has  seen  fit  to  indicate  that  the  size  of 
a  business  in  no  way  determines  its  inherent  character.  Growth, 
expansion,  intimate  relationship  to  other  enterprises,  these  are  im- 
portant, but  they  can  have  no  influence  in  determining  or  altering 
the  inherent  qualities  of  insurance.  No  growth  or  expansion  of 
the  live  stock  business,  for  instance,  will  ever  convert  a  hog  into 
a  horse,  and  no  more  extension  of  the  business  of  insurance  will 
ever  transform  its  personal  contracts  into  commercial  commodities. 

Since  insurance  is  held  not  to  be  commerce.  National  supervi- 
sion, through  Congressional  action,  can  never  be  achieved  except 
by  way  of  an  amendment  to  the  Constitution  of  the  United  States; 
and  what  are  the  probabilities  of  securing  such  an  amendment? 

The  obstacles  are  both  practical  and  sentimental.  From  one 
standpoint  it  seems  almost  like  laying  unholy  hands  on  the  Ark 
of  the  Covenant  to  ask  the  Congress  of  this  great  Republic  to 
adopt  an  amendment  to  the  organic  law  of  the  land  merely  to 
bring  one  non-commercial  branch  of  business  under  Federal  con- 
trol. Except  as  the  proposition  is  somewhat  redeemed  by  the 
tremendous  volume  of  such  business  and  by  the  genuine  ability  and 
sincerity  of  the  eminent  men  who  have  been  and  who  are  now  fore- 
most in  the  advocacy  of  such  an  amendment,  the  suggestion  would 
not  receive  serious  consideration  at  the  hands  of  any  Congres- 
sional committee. 

But  suppose  the  unexpected  should  happen  and  that  the  present 
pending  amendment  to  the  Constitution,  or  some  other,  should  be 
adopted  by  Congress,  what  then?  What  are  the  probabilities  that 
such  an  amendment  would  be  ratified  by  three-fourths  of  the  States 
of  the  Union?  In  this  discussion  it  is  always  assumed  that  no  one 
contemplates  or  desires  both  National  and  State  supervision,  and 
it  becomes  quite  pertinent  therefore  to  ask  what  are  the  probabili- 
ties that  the  requisite  number  of  States  will  voluntarily  surrender 
their  present  right  over  insurance  corporations,  foreign  and  do- 
mestic, to  the  Federal  government?  What  States  in  the  Union 
would  be  likely  thus  to  forego  the  enormous  revenue,  the  political 
prestige,  the  local  pride,  now  resulting  from  State  supervision? 
What  States  would  be  likely  to  augment  the  power  of  the  Federal 
government  over  their  created  institutions  by  clipping  the  wings 
of  their  own  sovereignty?  It  may  well  be  doubted  whether  a  single 
State  would  vote  to  ratify  such  an  amendment ;  but,  in  any  event, 
so  sure  as  the  genius  of  our  dual  government  is  what  it  is,  so  long 
as  human  nature  is  what  it  is,  so  long  as  practical  ]K,litics  is  what 
it  is,  the  idea  that  three-fourths  of  the  States  of  this  TTnion  would 
vote  to  approve  an  amendment  to  the  Constitution  of  the  United 


WORLD'S  INSURANCE  CONGRESS  335 

States,  having  for  its  single  purpose  the  placing  of  one  species 
of  business  under  Federal  control,  scarcely  rises  to  the  dignity 
of  the  late  Kansas  statesman's  "iridescent  dream." 

Desiring  to  make  this  discussion  as  useful  as  possible  and  to 
present  to  the  World 's  Congress  of  Insurance  an  exhibit  of  present 
day  public  opinion,  I  addressed  a  brief  letter  to  the  legal  reserve 
life  companies,  to  the  domestic  fire  companies,  to  the  domestic 
casualty  companies  and  to  the  insurance  commissioners,  asking 
simply  whether  at  this  time  they  were  for  or  against  National 
supervision. 

I  wish  here  to  express  my  obligation  to  all  who,  by  their  prompt 
and  courteous  replies,  assisted  in  the  preparation  of  a  sort  of  com- 
posite photograph  of  the  present  state  of  public  opinion  touching 
the  matter  of  National  supervision.  It  will,  perhaps,  be  more 
suggestive  and  instructive  to  separate  these  replies  into  classes  be- 
fore calling  attention  to  them  as  a  whole.  Of  replies  received  from 
insurance  commissioners,  81  per  cent  were  in  opposition  to  Na- 
tional supervision  and  much  of  this  expressed  opposition  was  quite 
emphatic.  Of  replies  received  from  fire  and  casualty  companies, 
58  per  cent  were  adverse  to  National  supervision.  Of  the  replies 
received  representing  life  insurance  companies,  and  these  replies 
came  from  all  parts  of  the  country  and  from  companies  of  all  ages 
and  sizes,  62  per  cent  were  emphatic  in  opposing  National  super- 
vision. One  insurance  commissioner  had  no  opinion  on  the  sub- 
ject, one  way  or  the  other.  Of  the  replies  from  all  sources,  taken 
as  a  whole,  62  per  cent  were  in  favor  of  State  as  against  Na- 
tional supervision. 

In  many  of  the  letters  received  were  clear  and  convincing  rea- 
sons given  for  the  views  expressed,  but  time  forbids  any  adequate 
reference  to  these,  even  though  they  would  throw  a  flood  of  light 
upon  the  undiscussed  phases  of  the  business  of  insurance  and  of 
the  real  motives  lying  back  of  many  conflicting  views  touching 
the  great  subject  of  insurance  supervision. 

This  altogether  hopeless  conflict  and  difference  of  opinion  is 
another  factor  in  the  proof  that  National  supervision  is  an  impos- 
sibility. But  even  though  National  supervision  be  not  attainable, 
its  most  ardent  advocates  need  not  despair.  The  alternative  does 
not  lie  between  National  supervision  and  ruin.  State  supervision 
is  not  the  cause  nor  would  National  supervision  be  the  cure  of  all 
of  the  ills  that  to-day  afflict  the  insurance  business. 

"The  fault,  dear  Brutus,  is  not  in  our  stars, 
But  in  ourselves,  that  we  are  underlings — " 

wrote  the  master  mind  of  the  world;  and  it  is  not  so  much  on 
account  of  its  externals  but  on  account  of  its  internals  that  insur- 
ance to-day  is  bearing  so  many  unnecessary  burdens.  It  is  not  in 
our  State  departments  and  our  numerous  State  legislatures,  any 
more  than  in  the  selfish  and  individualized  points  of  view  of  our 


336       WORLD'S  INSURANCE  CONGRESS 

home  offices,  that  we  must  seek  the  origin,  the  starting  point  of 
many  of  the  arbitrary  departmental  rulings,  much  of  the  conflict- 
ing legislation  and  a  large  part  of  the  unwise  and  unreasonable 
taxation  that  go  to  make  up  what  has  well  been  characterized  as 
the  "intolerable  situation"  of  the  insurance  companies.  We  have 
large  unperformed  internal  duties  and  large  unused  internal  op- 
portunities which  as  yet  have  been  but  inadequately  grasped.  We 
are  learning,  though,  all  too  slowly;  we  are  improving,  though 
altogether  too  much  at  the  speed  of  the  tortoise.  But  we  will  not 
fail;  we  will  reach  the  goal. 

In  the  insurance  business  and  in  the  insurance  departments  are 
men  of  high  talent  and  influence,  wide  experience  and  constructive 
skill  and,  when  this  combination  of  power  shall  be  harmoniously 
focused  in  sympathetic  cooperation  for  the  proper  development  of 
our  colossal  enterprise,  startling  things  will  come  to  pass.  What 
conflict  of  laws  could  not  be  removed,  what  iniquities  of  taxation 
could  not  be  corrected,  what  duplication  of  labor  and  expense 
could  not  be  prevented,  what  retaliatory  legislation  could  not  be 
repealed,  what  unreasonable  arbitrariness  in  departmental  rulings 
could  not  be  eliminated  and,  in  time,  what  substantial  uniformity 
of  legislation  could  not  be  secured  if  all  of  the  talented  men  en- 
gaged in  the  insurance  business,  if  all  insurance  organizations  of 
every  kind  and  character,  if  all  of  the  insurance  commissioners 
could  realize  the  practical  value  and  tremendous  power  of  hearty 
and  sympathetic  cooperation  for  the  purpose  of  achieving  a  given 
end! 

No  form  of  supervision.  State  or  National,  can  accomplish  every- 
thing. No  form  of  supervision  can  reach  the  attitude  of  vigorous 
and  ambitious  men  toward  their  fellows.  Supervision  can  never 
abate  vicious  competition  or  dispel  that  insidious,  though  unex- 
pressed, lack  of  confidence  "which  too  often  we  feel  toward  our 
associates,  and  from  which  heads  of  insurance  departments  are 
not  entirely  free.  Law  is  not  a  reformer.  It  is  but  the  concrete 
and  formal  expression  of  reforms  already  accomplished  in  human 
thought  and  feeling. 

But  it  is  not  with  a  picture  of  difficulties  or  shortcomings  that 
I  wish  to  close  this  address.  Rather  would  I  present  a  picture, 
fragmentary  though  it  may  be,  of  what  can  assuredly  be  brought 
to  pass  by  a  skillful  treatment  of  the  ills  we  have  rather  than  by 
flying  to  others  that  we  know  not  of. 

Ten  years  more  of  such  tremendous  strides  of  progress  toward 
the  proper  supervision  of  insurance  as  have  been  made  in  the  last 
decade  by  the  work  of  the  National  Association  of  Insurance  Com- 
missioners, of  the  Association  of  Life  Insurance  Presidents,  of 
the  American  Life  Convention,  of  the  National  Association  of 
Life  Underwriters  and  of  all  the  other  similar  associations.  State 
and  National,  and  most  of  the  grounds  of  complaint  so  frequently 
heard  to-day  will  have  passed  into  history.    Just  three  things,  and 


WORLD'S  INSURANCE  CONGRESS  337 

only  three,  are  required  for  this  much  hoped  for  consummation. 
The  first  of  these  is  cooperation ;  the  second  is  cooperation ;  and  the 
third  is  cooperation. 


GOVERNMENTAL  OBSTACLES  TO  INSURANCE 

By  David  Starr  Jordan 
Chancellor,  Leland  Stanford,  Junior,  University 

I  have  been  asked  to  speak  on  the  topic  of  'Governmental  Ob- 
stacles to  Insurance,"  not  that  I  have  any  special  knowledge  of 
the  topic,  but  because  these  obstacles  form  part  of  a  system  of  dis- 
cipline with  which  I  have  had  some  experience  and  in  which  you 
may  find  something  of  interest.  The  obstacles  in  question  are  those 
of  compulsory  State  insurance,  a  paternal  arrangement  which  safe- 
guards the  worker  without  any  will  or  initiative  of  his  own  or  even 
against  his  purpose.  The  insurance  premiums  are  not  a  gift,  but  a 
forced  withdrawal  of  some  portion  of  the  workman's  earnings,  and 
the  need  to  preserve  his  claim  to  these  savings  serves  as  a  safeguard 
to  prevent  him  from  wantonly  leaving  his  job.  Naturally  this  sys- 
tem, with  the  accompanying  system  of  old  age  pensions,  tends  to 
take  the  virtue  out  of  personal  care  for  the  future  by  throwing  the 
responsibility  on  the  state.  Naturally  also,  it  interferes  with  the 
normal  working  of  Insurance  arrangements,  for  these  appeal  to  in- 
dividual initiative  and  forethought.  These  thrive  best  in  an  at- 
mosphere of  freedom,  while  the  systems  of  State  insurance  and  old 
age  pensions  deal  with  men  and  women  mainly  as  cogs  in  the  wheels 
of  a  great  industrial  machine. 

We  all  recognize  in  theory,  at  least,  the  value  of  some  sort  of 
discipline.  This  involves  an  orderly  use  of  one 's  powers  and  a  will- 
ingness to  subordinate  our  whims  or  our  interests  to  some  general 
system  related  to  the  common  welfare.  Discipline  implies  obe- 
dience, and  the  different  types  of  obedience  indicate  the  nature  of 
this  discipline.  We  may  recognize  three  classes  of  discipline  of 
grown  men.  These  we  may  differentiate  as  Democratic,  Social,  and 
Paternal.  Under  the  democratic  discipline  each  man  is  responsible 
to  himself  for  his  own  guidance.  The  period  of  preliminary  edu- 
cation past,  he  chooses  his  profession,  his  own  ideals,  his  own  place 
in  the  world.  Democracy  means  opportunity,  nothing  more.  It 
opens  the  whole  world  before  each  man,  and  so  much  of  it  is  his 
as  he  has  the  wisdom,  the  strength  and  the  patience  to  take.  This 
life  is  not  successful  unless  he  has  the  wit,  the  soberness,  the  virtue 
to  make  it  so.  If  he  has  the  chance  to  rise,  he  has  also  the  chance 
to  fall.  He  is  not  held  in  his  place  by  dull  averages.  If  he  is 
able  to  develop  no  ideal,  if  he  wastes  his  strength  in  dissipation 
or  vice,  if  he  is  one  of  the  unfit  in  the  struggle  for  life,  he  must 
in  some  degree  take  the  consequences.     Under  a  democracy,  the 


338       WORLD'S  INSURANCE  CONGRESS 

government  is  simply  the  cooperation  of  the  people  for  mutual 
aid,  to  achieve  those  needful  results  which  are  beyond  the  reach 
of  private  effort.  Its  main  duty  is  summed  up  under  the  head 
of  justice.  And  under  this  head  come  sanitation,  education,  the 
conservation  of  resources,  the  making  of  roads  and  public  build- 
ings and  the  maintenance  in  national  and  international  relations 
of  law  and  order,  those  conditions  which  permit  of  progress,  of 
normal  effort  and  happiness,  which  we  call  by  the  general  name  of 
peace. 

What  I  call  social  discipline  arises  through  obedience  to  ideals 
formed  in  cooperation.  One's  inspiration  arises  not  primarily 
from  within  but  from  the  thoughts  and  needs  of  his  neighbors. 
At  its  best,  the  social  discipline  is  an  outgrowth  of  the  democratic 
discipline.  It  is  through  its  agency  that  the  great  cooperative  ef- 
forts of  our  race  are  achieved.  To  work  for  the  Nation  is  not  th6 
same  thing  as  "to  hold  down  a  government  job."  The  vulgar  atti- 
tude towards  public  affairs  is  found  in  all  nations — the  most  pro- 
nounced in  those  least  advanced  and  least  democratic.  But  a  sense 
of  social  service  is  one  of  the  best  incentives  to  personal  efficiency. 
It  is  this  sense  which  has  vivified  the  fight  against  yellow-fever,  the 
Bubonic  plague  and  the  multitude  of  minute  organic  pests  which 
we  know  by  their  efforts  as  infectious  disease.  It  is  the  impulse 
of  social  service  which  has  built  the  Panama  Canal,  which  is  re- 
straining the  floods  of  China,  which  is  healing  Serbia  and  feeding 
Belgium,  which  in  every  nation  in  its  degree  is  fighting  against  the 
War  System,  its  theory  and  its  results. 

The  social  discipline  must  rest  on  some  system  of  voluntary  co- 
operation. It  cannot  be  enforced  from  without.  Its  purpose  can- 
not be  accepted  as  a  substitute  for  achievement.  In  any  form  of 
enforced  cooperation,  the  fine  spirit  of  social  service  is  lost  some- 
how in  the  governmental  machinery.  Thus  far  the  communistic 
state  has  been  successful  only  as  a  theocracy  or  a  tyranny.  And 
a  state  ruled  over  by  a  detached  few  is  not  cooperative :  nor  can  it 
be  democratic  or  just. 

The  paternal  discipline  is  that  applied  to  the  people  of  a  na- 
tion from  the  outside.  The  people  are  chattels  of  the  state,  hav- 
ing no  control  over  its  actions,  the  state  having  a  glory  and  a 
prosperity  wholly  independent  of  the  prosperity  and  happiness  of 
its  people.  And  by  the  same  token,  its  rulers  must  govern  by 
divine  right,  else  they  could  have  no  sanction  at  all.  There  are 
but  two  sanctions  for  government,  the  one  the  will  of  the  people, 
the  other  the  divine  right  by  which  the  reins  of  power  were 
snatched  from  the  people  before  they  were  born. 

Under  paternal  discipline,  the  citizen  has  no  rights  save  those 
accorded  to  him  by  his  overlords  of  the  state.  The  forms  of 
democracy  under  paternalism  are  forms  only  useful  to  keep  him 
amused  while  his  neighbor  peoples  work  out  their  experiments  in 
liberty. 


AVORLD'S  INSURANCE  CONGRESS  339 

Most  men  in  every  nation  are  laboring  men.  In  democratic 
discipline  in  his  degree,  each  man  chooses  his  place  of  labor, 
and  rises  or  falls  according  to  his  own  ability,  fitness  or  training. 
A  low  estate  at  birth  is  no  bar  to  his  future  exaltation.  It  is 
the  essential  feature  of  the  paternal  discipline  that  most  men  stay 
where  they  are  put.  Freedom  is  defined  as  that  of  cheerfulness 
which  results  from  satisfaction  at  having  any  place  at  all  in  a  world 
which  is  said  to  be  overpopulated. 

The  son  of  a  working  man  finds  himself  in  face  of  a  multitude 
of  trades.  He  is  sent  perforce  to  a  trade  school,  and  is  relieved 
from  the  menace  which  threatens  unskilled  labor.  The  fees  are 
low,  as  is  also  his  capacity  for  paying  them.  The  differences  among 
men  are  reduced  to  their  lowest  terms.  He  finds  himself  in  some 
definite  niche  in  the  industrial  machine.  Government  Intelligence 
offices  find  his  place  for  him.  Government  insurance  keeps  him 
there.  He  cannot  well  fall  below  his  class.  He  cannot  easily  rise 
above  it.  For  his  modest  future  he  must  depend  on  his  savings, 
not  on  promotion.  The  university,  the  professional  school  are  out 
of  his  reach,  except  in  the  rare  event  of  being  a  born  prize-winner, 
or  the  equally  rare  possibility  of  marrying  rich.  It  is  blue-blood, 
not  red,  that  mostly  attracts  heiresses,  the  world  over.  Universal 
compulsory  education,  technical  as  well  as  academic,  forms  part  of 
the  paternal  system  and  this  saves  even  the  weakminded  from 
absolute  incompetence.  Three  years  of  military  service,  under 
graduates  of  the  barracks,  break  the  individual  will  and  leave  a 
docile  subject  in  all  further  discipline.  In  its  "  unescapable " 
stimulus  to  patriotism,  it  fits  its  subject  to  obey  the  orders  of 
higher  authority  without  asking  for  reason  why.  The  industrial 
value  of  such  discipline  is  plain.  The  employer  can  count  on 
skilled  labor  and  labor  that  is  well  drilled  and  mostly  free  from 
the  noxious  spirit  of  individualism.  To  escape  from  his  industrial 
position  usually  brings  only  discomfort  and  failure  if  nothing 
worse.  The  feeling  of  injustice  works  itself  out  in  vague  grouches 
and  vaguer  unrest,  not  in  those  positive  efforts  for  change  which 
threaten  industrial  serenity  in  nations  which  encourage  private 
initiative. 

In  Prussia,  it  is  said,  a  citizen  has  three  duties,  "Soldat  sein: 
steuer  zahlen;  mund  halten"  ("be  a  soldier;  pay  taxes;  keep  the 
mouth  shut").  These  are  simple  and  they  do  not  encourage  initia- 
tive. Nothing  is  said  about  eternal  vigilance,  which  as  we  know, 
is  the  price  of  Liberty.  Under  this  system  Liberty  gives  place  to 
security,  and  being  a  soldier,  this  security  is  precarious,  for  the 
business  of  the  soldier  is  war. 

Under  universal  conscription  the  individual  loses  his  rights 
without  acquiring  duties.  The  task  of  the  soldier  is  not  his  own 
nor  that  of  society.  He  is  held  in  subjection  to  a  central  power. 
In  this  discipline  the  people  exist  for  the  welfare  of  the  state,  the 
highest  purpose  of  the  nation  being  that  of  collective  efficiency. 


340       WORLD'S  INSURANCE  CONGRESS 

The  workman  has,  therefore,  the  choice  between  the  docile  ac- 
ceptance of  a  fate  not  wholly  intolerable  and  revolt  with  certain 
misery.  State  insurance  against  poverty,  unemployment  or  old 
age  guard  him  against  total  failure  and  at  the  same  time  cut  the^ 
nerve  of  any  effort  to  gain  such  security  for  himself. 

"The  various  forms  of  labor  insurance  alone,"  says  Price  Collier, 
"in  Germany  cost  the  state  over  $250,000  a  day.  ...  No  wonder 
that  between  the  case  of  a  grandmotherly  state  and  the  attentions 
of  a  subservient  womankind  the  male  population  increases.  .  .  . 
Nowhere  has  socialistic  legislation  been  so  cunningly  and  skilfully 
used  for  the  enslavement  of  the  people.  No  small  part  of  every 
man's  wages  is  paid  to  him  in  insurance,  insurance  for  unemploy- 
ment, for  accident,  sickness  and  old  age.  There  is  but  faint  hope 
of  saving  enough  to  buy  one's  freedom  and  if  the  slave  runs  away 
he  leaves,  of  course,  all  the  premiums  he  has  paid  in  the  hands  of 
his  master." 

The  difficulties  which  beset  the  common  man  in  trying  to  rise 
from  his  class — to  enter  one  of  the  learned  professions  or  the  sub- 
limated caste  of  the  army — deter  all  but  the  most  gifted  from  ambi- 
tion for  advancement.  Only  real  genius  for  scholarship  or  for 
money  getting  can  break  the  bonds  of  caste.  This  system  mini- 
mizes the  miseries  of  poverty,  while  at  the  same  time  it  checks 
initiative  and  independent  thought  in  the  mass  of  the  people.  To 
say  that  "it  solves  the  problem  of  poverty"  is  to  mistake  veneer 
for  reality.  The  body  of  the  people  under  paternal  discipline  in 
any  country  are  miserably  poor,  and  the  lot  of  those  outside  ranks 
of  skilled  labor  is  pitiable  in  the  extreme.  There  is  no  solution 
of  the  problem  of  poverty  which  takes  away  the  need  of  each 
man  to  try  to  solve  it  for  himself. 

There  can  be  no  true  greatness  of  a  state  except  through  the 
greatness  of  the  human  units  for  whose  welfare  the  state  should 
exist.  The  whole  world  suffers  to-day — from  the  domination  of  a 
great  state  over  a  people  which  has  lost  the  power  of  self-direction 
and  which  has  abdicated  the  duty  of  government,  abandoning  them 
to  the  will  of  a  military  aristocracy,  whose  chief  concern  is  any- 
thing save  the  welfare  of  the  people. 

The  subordination  of  individual  freedom  to  a  prearranged  effi- 
ciency naturally  culminates  in  the  organization  of  fluid  force  as 
military  power,  the  extreme  opposite  to  democracy.  The  individual 
under  martial  law  has  no  opinions,  no  rights,  no  existence  save  as 
a  fragment  of  humanity  to  be  used  by  the  state  at  its  will.  The 
soldier  exists  for  war  and  war  is  the  failure  of  government  in  its 
highest  functions.  In  the  words  of  Ilavelock  Ellis,  "To  glorify 
the  state  is  to  glorify  war,  for  there  is  no  collective  operation  which 
can  bo  so  ofTcctively  achieved  as  war,  and  none  whicli  more  con- 
spicuously illustrates  the  sacrifice  of  the  individual  to  the  nation." 

It  is  for  this  reason  that  militarism  has  been  through  the  ages 


WOKLD'S  INSURANCE  CONGRESS  341 

the  right  arm  of  privilege,  as  the  state  church,  the  form  of  religion 
which  ignores  the  individual  man,  has  always  been  its  left  arm. 

Writers  of  the  day  frequently  contrast  "Germany's  success  in 
solving  the  problem  of  poverty"  with  "the  wretched  condition  of 
England's  poor."  It  is  said  that  "England  has  the  most  ungrate- 
ful and  laziest  poor  to  be  found  in  any  land,"  and  these  poor 
are  said  to  be  as  unpatriotic  as  they  are  lazy.  They  are  blind,  too,- 
for  the  pauper  vote  of  England  is  almost  solidly  opposed  to  the 
efforts  of  those  who  would  use  public  action  in  betterment  of  their 
condition. 

From  this  it  is  argued  that  as  England  is  a  land  of  freedom 
while  Germany  is  a  land  of  efficiency,  the  ideals  of  freedom  need 
reconsideration  in  the  direction  of  paternal  discipline. 

Miss  Prestonia  Mann  Martin  observes:  "The  two  forms  of  gov- 
ernment are  to-day  on  trial.  The  watchword  of  democracy  is 
freedom.  The  watchword  of  paternalism  is  duty.  Followed  to 
their  conclusions,  one  leads  to  anarchy,  the  other  to  its  opposite, 
socialism.  One  tends  to  decentralize  government,  the  other  to  cen- 
tralize it.  One  aims  at  individual  independence,  the  other  at  na- 
tional efficiency.  One  places  the  highest  value  upon  freedom,  the 
other  sacrifices  freedom  for  the  sake  of  order,  system,  power,  se- 
curity. ' ' 

This  analysis  is  true,  so  far  as  it  goes,  but  the  end  of  democracy 
is  not  freedom,  nor  yet  opportunity,  the  two  meaning  much  the 
same  thing.  The  ideal  is  also  duty,  but  duty  self-imposed,  or  aris- 
ing from  a  feeling  of  the  needs  of  society,  not  duty  imposed  from 
without. 

The  need  of  Great  Britain  as  I  see  it  is  not  more  governmental 
system.  The  "sodden  misery  of  the  London  slums,  the  horrors  of 
the  black  country,"  the  exhaustion  of  the  countryside,  the  failure 
of  the  yeomanry,  these  call  for  more  freedom,  not  for  paternal- 
ism. "The  inevitable  toll  of  corruption  and  incompetence"  is 
not  a  result  of  freedom.  Its  historic  roots  lie  in  the  struggle  for 
imperialism.  They  can  never  be  absent  under  any  form  of  gov- 
ernment, so  long  as  men  are  greedy  or  incompetent.  The  preda- 
tory rich  and  the  desultory  poor  occur  under  all  forms  of  govern- 
ment and  in  some  fashion  or  other ;  the  one  will  feed  on  the  other 
and  both  are  parasitic  on  the  common  weal. 

The  men  who  stand  for  more  freedom  in  England  are  the  men 
most  eager  to  do  away  with  needless  misery  and  sorrow.  The 
evils  in  British  society  are  not  results  of  democracy,  but  legacies 
of  the  era  of  aristocracy,  paternalism  and  imperialism.  British 
polity  still  rests  on  inequality  before  the  law.  The  statute  of  primo- 
geniture thrusts  the  hated  principle  of  precedence  into  every  fam- 
ily. The  state  church  discriminates  against  personal  religion. 
The  governmental  effort  not  long  ago  to  strengthen  the  landed 
aristocracy  gave  to  England  and  Scotland  their  insoluble  land 
problems.     Only  in  very  recent  years  has  the  free  school  found 


342  WORLD'S  INSURANCE  CONGRESS 

place  in  Great  Britain.  The  holding  of  India  at  the  public  cost 
for  private  exploitation  has  enriched  a  very  few  at  the  expense  of 
the  very  many.  The  wars  in  India  and  Africa  exhausted  in  large 
degree  the  British  3'eomanry,  while  those  whom  war  could  not  use 
slid  down  the  line  of  least  resistance  into  the  slums  of  the  great 
cities.  There  they  have  bred  generations  of  like  incompetents 
in  an  atmosphere  of  drink  and  vice.  The  young  men  of  parts  have 
been  used  and  used  up  by  the  thousand  in  the  colonial  service. 
The  weaker  elements  have  multiplied  while  fine  strains  have  been 
destroyed. 

The  liquor  interests  have  filled  Great  Britain  and  Ireland  with 
race  poisons,  and  these  in  aristocratic  times  waxed  so  powerful 
that  the  democracy  has  as  yet  failed  to  dislodge  them.  In  brief, 
the  ills,  political  and  social,  of  Great  Britain  have  nowhere  their 
origin  in  democracy,  but  in  governmental  abuses  and  inequalities 
against  which  British  democracy,  one  of  the  strongest  and  most 
devoted  of  all  world  forces,  is  manfully  struggling.  And  the  most 
disastrous  of  all  elements  of  evil,  the  War  System,  is  wholly  un- 
democratic. It  has  been  brought  on,  not  because  democracies  are 
"loosely  organized,  careless  and  disorderly,"  but  because  "com- 
pact brotherhoods  which  have  been  welded  into  a  family-nation 
by  the  fostering  care  and  the  strict  discipline  of  a  paternalistic 
government"  have  become  politically  so  incompetent  that  they 
are  driven  like  sheep  into  a  w^ar  which  they  did  not  want,  which 
could  bring  them  nothing  but  ruin  and  which  in  its  inception 
and  consummation  constitutes  in  itself  the  most  heinous  crime 
ever  perpetrated  in  the  history  of  Christendom.  And  all  this  at 
the  dictation  of  a  very  few  men  whom  even  yet  the  nation  has 
failed  to  identify.  When  the  whole  story  is  told,  the  lesson  we 
must  read  is  that  the  remedy  for  the  shortcomings  of  freedom  is 
more  freedom,  that  personal  initiative  counts  more,  even  in  na- 
tional enterprise,  than  any  form  of  enforced  efficiency,  that  the 
need  of  free  states  is  not  less  freedom  but  more  justice,  for  jus- 
tice sets  men  free,  and  that  the  worst  possible  test  of  a  nation  ^s 
greatness  is  found  in  the  mischief  she  can  do  to  her  neighbors,  in 
blind  leading  of  the  blind  to  the  field  of  battle.  That  battlefields 
still  exist  is  due  to  the  failure  of  justice  and  therefore  of  individual 
freedom. 

It  is  true,  as  has  been  stated,  that  "State  socialism  as  Germany 
is  demonstrating  demands  the  price  and  then  delivers  the  goods." 
But  what  terrible  goods  this  system  stands  ready  to  deliver ! 

The  democratic  discipline,  self-imposed  by  men  who  think  and 
act  for  themselves  is  effective  in  making  men,  and  it  is  the  initia- 
tive of  individual  men  Avhich  makes  and  marks  history. 

The  social  discipline  which  springs  from  individualism  is  effec- 
tive in  building  up  human  society,  and  the  inspiration  which  rises 
from  the  thought  of  cooperative  help  is  the  best  antidote  for  the 
greed  of  unchecked  and  perverted  individualism. 


WORLD'S  INSURANCE  CONGRESS  343 

The  paternal  discipline  provides  in  its  degree  for  material  com- 
fort and  security.  It  takes  away  the  necessary  incentive  to  every 
man  to  solve  his  own  problems.  In  a  free  state,  the  sober  and 
honest  working  man  should  be  free  to  abolish  his  own  poverty,  to 
enhance  his  own  security  or  that  of  his  family  through  insurance — 
or  at  his  own  descretion  to  let  it  alone. 


OPENING  ADDRESS  OF  CHAIRMAN 

RoLLA  V.  Watt 
Manager,  Royal  and  Queen  Insurance  Companies 

It  was  a  happy  idea  on  the  part  of  the  promoters  of  these  great 
conservation  congresses  to  bring  together  two  associations — the  In- 
ternational Peace  Congress  and  the  World's  Insurance  Congress. 
Hand  in  hand  these  bodies  move  forward  in  their  effort  to  promote 
the  happiness  and  well  being  of  mankind.  Helpless  as  in  the  pres- 
ent situation  we  seem  to  be,  nevertheless  we  believe  the  influences 
of  such  organizations  as  these  represented  here  will  prove  ef- 
fective. 

This  is  a  joint  meeting  of  the  World's  Insurance  Congress  and 
the  International  Peace  Congress.  There  are  115  organizations 
represented  in  the  World's  Insurance  Congress,  24  of  which  are 
of  altruistic  character,  if  indeed  all  of  them  may  not  be  said  to  be 
of  such  a  class.  May  I  name  a  few  of  them  by  way  of  illustration  ? 
The  American  Peace  Society,  of  which  Dr.  Jordan  is  the  President ; 
The  American  Mine  Safety  Association,  The  American  Museum 
of  Safety,  The  American  Society  for  the  Prevention  of  Force,  the 
Bureau  of  Commercial  Economics,  Health  &  Life  Conservation 
Bureau,  The  National  Safety  Council,  the  Safety  First  Federation, 
The  Association  for  the  Study  and  Prevention  of  Tuberculosis. 

The  progi-am  of  the  World's  Insurance  Congress  contains  a 
sentence  worth  considering.  Through  the  performance  of  its  func- 
tions of  indemnifying  for  loss,  insurance  has  become  the  great 
agent  of  prevention — the  prevention  of  fire,  accident  and  disease. 
The  prolongation  of  life  means  the  elimination  of  waste  or  less, 
which  in  turn  means  the  addition  of  hundreds  of  thousands  of 
lives  and  hundreds  of  millions  of  dollars  to  the  wealth  of  the 
nation  every  twelve  months.  Fire  insurance  distributes  the  losses 
of  the  few— relatively  few— among  the  many,  minimizing  the  bur- 
den; workmen's  compensation  removes  the  curse  of  poverty  from 
the  home  of  the  unfortunate  workman — individual  workman  dis- 
tributing the  financial  burden  equally  among  the  great  body  of  the 
people ;  life  insurance  touches  life,  proves  a  money-saving  proposi- 
tion for  those  who  accept  its  benefits,  and  is  a  means  for  relieving 
public  charity. 


344       WORLD'S  INSURANCE  CONGRESS 

And  now,  turning  more  directly  to  the  work  of  this  hour,  we  are 
met  to-day  in  joint  session  with  these  great  peace  organizations, 
devoted  to  the  education  of  the  world  in  the  arts  and  advantages 
of  peace.  The  character  of  the  men  who  are  to  participate  and 
the  scope  of  the  topics  to  be  discussed  command  the  respect  and 
the  enthusiasm  of  all  good  citizens.  We  are  to  be  congratulated 
upon  having  such  men  from  all  over  the  country  as  are  to  partici- 
pate in  this  program. 


INTERNATIONAL   INSURANCE 

By  Professor  Josiah  Royce 
Harvard  University 

I  venture,  as  a  member  of  the  World's  Insurance  Congress 
Peace  Day  Committee,  to  call  attention  to  the  fact  that  an  Inter- 
national Insurance  Congress  might  well  gain  some  profit  for  the 
ideals  which  it  represents,  and  for  the  cause  of  the  world's  peace, 
if  it  made  some  use  of  the  opportunity  which  a  conference  of  so 
large  and  authoritative  a  body  furnished,  to  give  due  place  to  some 
consideration  of  the  question  whether  the  time  is  not  near  when  a 
beginning  might  be  made  in  introducing  into  international  rela- 
tions that  principle  of  insurance  which  the  experience  of  the  last 
century  has  shown  to  be  so  fruitful  a  factor  in  promoting  the 
cause  of  peace  and  of  mutual  understanding,  as  well  as  of  wide  and 
potent  cooperation  in  the  social  life  of  individual  nations. 

I  am  aware  how  little  right  I  have  to  speak  authoritatively  about 
many  of  the  social  and  about  all  of  the  financial  problems  which 
every  great  extension  of  the  insurance  principle  necessarily  in- 
volves. I  have  no  wish  to  take  up  the  attention  of  your  Committee, 
or  any  of  the  committees  of  the  Congress,  in  listening  to  any  sug- 
gestions of  my  own.  But  since  you  have  so  kindly  asked  me  to 
be  a  member  of  your  Committee  in  connection  with  the  Peace  Day, 
I  should  fail  in  my  duty  as  such  member  of  your  Committee,  and 
should  also  miss  an  inestimable  privilege,  if  I  did  not  make  use 
of  this  chance  to  mention  very  briefly  my  reasons  for  believing 
that  some  practical  beginning  in  International  Insurance  are  al- 
ready possible,  that  the  general  principle  of  international  insur- 
ance could  already  be  introduced  into  some  international  relations, 
and  that  the  least  beginning  of  any  practicable  form  of  interna- 
tional insurance  would  be  sure  to  lead  to  further  progress  in  the 
same  beneficent  direction.  A  beginning  once  made  in  applying 
insurance  to  any  sort  of  international  business,  progress  would  be 
inevitable.  New  forms  of  such  international  insurance  would  be 
invented.  Every  new  form  of  insurance  would  mean  a  new  and 
practically  important  form  of  international  business,  and  of  busi- 


WORLD'S  INSURANCE  CONGRESS  345 

ness  that  could  be  kept  in  great  measure  free  from  diplomatic, 
from  political,  and  consequently  even  from  judicial  controver- 
sies. The  consequence  would  be  that  there  would  exist  more  and 
more  international  relations  of  a  type  which,  if  possible  at  all, 
must  be  indirectly  productive  of  peaceful  activities  and  interests, 
and  of  concerns  which  would  be  at  once  what  all  the  developments 
of  insurance  have  in  their  combination  proved  to  be  in  social  life, — 
namely,  at  once  businesslike  and  ideal,  at  once  humanitarian  in 
their  sentiment  and  practically  effective  in  their  social  results. 

The  insurance  principle  in  the  life  of  individual  nations  has 
recently  tended  to  take  on  many  new  forms.  For  instance,  social 
insurance  grows  daily  more  significant  in  the  development  of  civili- 
zation. The  World's  Insurance  Congress  at  San  Francisco  will  de- 
vote much  attention  to  social  insurance,  as  well  as  to  other  recent 
applications  of  the  insurance  principle.  Some  of  these  applications 
are  already,  so  to  speak,  almost  automatically  international  in  their 
bearings.  And  that  is  why  International  Insurance  Congresses, 
intended  to  compare  and  to  spread  information  regarding  the  va- 
rious new  developments  and  applications  of  the  insurance  princi- 
ple, have  already  been  held,  and  have  proved  fruitful  for  the  com- 
mon interests  of  various  people.  A  definite  plan  whereby  a  group 
of  nations  could  be  profitably  and  practicably  led  to  form  insur- 
ance unions,  w^herein  the  nations  themselves  should  be  parties,  has 
not  yet  been  formed  and  recognized.  I  venture  to  urge  that  such 
a  plan  is  not  impossible,  that  if  it  were  formed,  and  that  if  it 
were  even  in  small  measure  adopted  by  any  group  of  nations,  a 
beginning  could  be  made  in  what  would  in  the  long  run  prove  to 
be  a  verv'  powerful  influence,  both  for  human  prosperity  and  for 
international  peace. 

I  venture  also  to  say  that  whatever  influence  a  plan  involving 
international  insurance  might  exert,  this  influence,  so  far  as  the 
general  cause  of  promoting  peace  is  concerned,  would  be  opposed 
to  none  of  the  other  influences  in  which  the  advocates  of  the  mod- 
ern peace  movements  have  heretofore  shown  an  interest,  and  with 
regard  to  which  they  have  entertained  strong  hopes.  If  any  form 
of  international  insurance  proves  to  be  possible,  it  will  in  nowise 
tend,  when  put  into  practice,  to  interfere  with  the  progress  of  in- 
ternational arbitration.  It  will  in  noAvise  tend  to  retard  any  other 
practicable  movement  whch  lends  toward  the  federation  of  man- 
kind. Insurance  is  consistent  with  any  wise  form  of  social  con- 
stitution. It  is  a  social  influence  essentially  neutral  in  its  relations 
to  those  issues  regarding  the  best  forms  of  national  or  interna- 
tional social  organization,  which  form  to-day  the  most  controverted 
issues.  The  essence  of  insurance  is  that  it  is  a  principle  at  once 
peace-making  in  its  general  tendency,  and  businesslike  in  its  prac- 
ticable special  application.  I  venture  to  say  a  word  in  explana- 
tion of  this  thesis. 

The  peace-making  influence  of  the  modern  institutions  which 


346  WORLD'S  INSURANCE  CONGRESS 

embody  the  insurance  principle  is  largely  au  indirect  influence. 
People  are  induced  to  insure,  with  the  hope,  and,  in  successful 
cases,  with  the  well-founded  hope,  of  rendering  less  formidable 
their  personal  risks.  As  a  result  of  insuring,  they  gradually  find 
themselves  involved  in  a  social  network  of  complicated  but  benef- 
icent relations,  of  which  individuals  are  usually  very  imperfectly 
aware,  but  by  means  of  which  modern  society  has  been  profoundly 
transformed.  I  believe  that  what  is  most  essential  about  this  net- 
work of  social  relationships  is  this:  whatever  a  man  consciously 
intends  to  do,  when  he  insures  his  life,  or  his  house,  or  his  trust- 
worthiness as  an  employee,  or  his  health,  or  anything  else  that  is 
his — the  most  important  result  which  he  accomplishes  through  an 
act  of  insurance  is  that  he  provides,  not  for  the  creature  of  a  day 
called  himself,  but  for  a  being  called  in  general  his  Beneficiary. 
His  beneficiary  may  be  intended  to  be  himself.  He  supposes  him- 
self to  be  insuring  his  house  for  his  own  sake.  But  as  a  fact  every 
insurance  policy  is  in  favor  of  some  beneficiary,  that  is,  of  some- 
body to  whom  the  insurance  is  to  be  paid  in  case  the  insurance 
has  to  be  paid  at  all.  Now  the  man  who  buys  the  insurance  is  a 
creature  of  a  day.  But  his  beneficiary  may  be  a  man  or  a  cor- 
poration, may  be  his  creditor,  or  his  employer,  or  his  heir,  or  his 
assignee, — may  thus  be  in  the  most  varied  and  social  relations  to 
the  insurer,  who  at  the  time  when  he  insures  need  not,  and  in  gen- 
eral does  not,  personally  know  what  individual  man  will  stand 
in  the  position  of  the  beneficiary  at  the  moment  when  the  insur- 
ance has  to  be  paid,  if  ever  the  policy  requires  it  to  be  paid.  With 
this  beneficiary  the  insuring  corporation  links  the  person  who  pur- 
chases the  insurance  by  ties  which  may  be  of  the  utmost  impor- 
tance for  the  whole  social  order.  Thus  the  insurer  builds  for  those 
who  come  after  him  in  ways  which  may  be  as  beneficent  as  for  the 
whole  social  order  they  prove  in  the  long  run  to  be  potent. 

Because  of  these  relations  to  the  beneficiary,  the  people  who  pur- 
chase insurance  tend  to  be  linked  to  the  whole  social  order.  It  is 
not  merely  that  the  mutual  principle  links  the  members  of  a  mu- 
tual insurance  company  to  their  fellow  members.  The  fact  is  that 
forms  of  social  enterprise,  types  of  social  linking,  unities  of  hu- 
man endeavor — far-reaching  social  loyalties — are  made  possible 
through  insurance,  in  a  way  that  no  other  social  institution 
renders  possible. 

Thus  fire  insurance  makes  possible,  in  a  large  class  of  cases,  the 
advancing  of  capital  towards  the  building  of  houses.  The  private 
individual  needs  a  home,  and  borrows  money  to  get  it.  In  order 
to  accomplish  this  end,  he  has  to  make  the  man  who  advances 
the  money  to  build  his  house  the  benoficiaiy  of  an  insurance  pol- 
icy. Thus  fire  insurance  makes  possible  the  building  of  countless 
homes  that  could  not  otherwise  be  built.  Just  because  a  man  who 
means  to  acquire  a  home  on  an  installment  plan  insures  not  merely 
his  own  house,  but  the  risk  whicli  is  taken  by  his  creditor,  whom 


WORLD'S  INSURANCE  CONGRESS  347 

he  makes  the  beneficiary  of  his  policy,  the  home  seeker,  in  vast 
numbers  of  cases,  is  thus  linked,  not  merely  to  his  insurance  com- 
pany and  not  merely  to  the  fellow-members  of  some  mutual  insur- 
ance company,  but  to  the  whole  world  of  organized  capital  upon 
which  he,  and  such  as  he,  depend  for  their  homes,  or  for  numer- 
ous other  such  social  advantages. 

In  such  instances  the  most  potent  influence  of  insurance  is  its 
indirect  influence.  Such  instances  can  be  indefinitely  multiplied. 
A  young  man  needs  an  opportunity  multiplied  and  wins  it  through 
some  form  of  fidelity  insurance,  in  which  his  employer  becomes 
the  beneficiary  of  the  policy.  Thus  fidelity  insurance  gives  to 
countless  persons  an  opportunity  to  win  manhood  and  a  place  in 
the  world,  which  would  be  impossible  without  such  insurance.  The 
possessor  of  a  life  insurance  policy  can  offer  in  succession  to 
various  beneficiaries,  what  gives  him  credit  or  standing,  or  hope 
in  the  world,  or  opportunity  to  direct  his  life,  in  such  wise  that 
one  ill-defines  the  extent  of  the  importance  of  life  insurance  by 
confining  one's  attention  to  the  fact  that  a  man  normally  makes, 
in  very  many  cases,  some  member  of  his  own  family  the  nominal 
beneficiary  of  the  policy.  What  is  essential  to  the  situation,  is 
that  life  insurance,  like  the  other  forms  of  insurance,  links  a  man, 
through  an  insuring  corporation,  to  his  beneficiary,  and  therefore 
tends  to  link  all  men  together  by  ties  upon  which  social  concord  and 
consequent  progress,  daily  more  and  more  depends.  And  I  insist 
that  it  is  not  merely  the  special  sort  of  social  unity,  such  as  mutual 
insurance  companies  directly  and  obviously  represent,  which  we 
have  to  consider.  The  linkage  of  a  man  through  his  insuring  cor- 
poration to  the  being  called  his  beneficiary,  is  one  of  the  most 
protean,  far-reaching  and  hopeful  types  of  linkage  yet  invented. 
The  principle  of  insurance  has  introduced,  and  will  continue  to 
introduce,  a  new  type  of  social  life  into  the  whole  human  order  of 
which  we  are  members. 

Now  just  because  of  this  indirect  influence  of  the  insurance 
principle  in  those  cases  where  it  proves  practicable  within  the  life 
of  single  nations,  I  submit  that  it  is  perfectly  reasonable  to  ex- 
pect a  vast,  a  gradually  increasing,  and  in  the  long  run  an  enor- 
mously potent  influence,  if  once  the  principle  of  insurance  is  in- 
troduced into  international  life,  in  any  one  of  the  forms  in  which, 
as  I  believe,  a  genuine  beginning  is  already  possible.  Here  is  no 
place  to  enumerate  these  possible  forms.  Let  me  say  that  various 
recent  forms  of  social  insurance,  some  of  them  already  successful, 
certain  of  them  promising  soon  to  begin  assuming  definite  shape, 
are  of  such  nature  that  they  obviously  interest  a  good  many  dif- 
ferent nations,  interest  these  nations  together,  and  will  succeed 
in  future,  if  at  all,  upon  the  basis  of  a  conscious  international  co- 
operation. In  future,  insurance  against  strikes  will  become  a  val- 
uable form  of  social  insurance.  Such  insurance  would  be  far 
nearer  to  becoming  practicable  if  various  nations  began  to  co- 


348  WORLD'S  INSURANCE  CONGRESS 

operate  in  some  insurance  enterprise  of  this  type  than  it  now  is. 
Insurance  against  various  migratory  pestilences,  such,  for  instance, 
as  tuberculosis,  could  assume  forms  which  would  lead  to  inter- 
national agreement  tending  to  that  definitive  control,  and  possible 
future  extinction  of  some  such  pests,  which  the  world  so  much 
needs. 

Such  are  but  a  few  instances  of  possible  matters  that  could  be 
made,  ere  long,  perfectly  practicable  matters  for  a  businesslike  in- 
ternational insurance,  if  only  the  lovers  of  peace  and  the  experts 
in  the  new  developments  of  the  insurance  principle  were  suffi- 
ciently and  steadily  interested  in  applying  the  insurance  principles 
to  these  new  fields.  Such  application  of  the  insurance  principle  to 
international  interests  would  not,  if  it  began  modestly  and  cau- 
tiously, imply  any  too  great  amount  of  altruism,  or  anything  but 
good  sense  in  dealing  with  great  opportunities.  Insurance  agree- 
ment amongst  the  nations  would  not  necessarily  involve  puzzling 
treaties,  or  new  international  rivalry,  or  new  forms  of  arbitra- 
tion, or  new  international  tribunals.  What  would  be  needed  would 
be  the  formation  of  something  of  the  nature  of  an  International 
Board  of  Trustees,  with  powers  not  political,  and  not  judicial,  but 
fiduciary.  There  would  be  ways  in  which  such  a  Board  could  be 
selected,  and  its  trustworthiness  reasonably  guaranteed.  There 
would  be  ways  in  which  the  funds  put  into  the  hands  of  such  trus- 
tees could  be  made  reasonably  safe  against  wars,  and  against 
predatory  interests.  The  business  of  international  insurance  would 
be  carried  on  through  the  sale  of  policies  to  the  individual  nations. 
The  contracts  required  would  be  made  by  the  insuring  nations  with 
the  International  Board  of  Trustees.  The  nations  in  question, 
without  any  controversy  with  the  Board,  could  withdraw  at  pleas- 
ure, under  suitable  conditions,  by  simply  surrendering  their  poli- 
cies. Were  such  a  Board  once  in  existence,  and  did  any  group  of 
nations,  however  small,  once  consent  to  make  use  of  the  services 
of  the  International  Board  of  Trustees,  the  form  of  insurance  in 
question  might  begin  with  any  one  of  a  great  number  of  different 
possible  interests  and  risks — risks  natural  and  inevitable,  risks 
social  and  moral,  risks  that  could  be  gradually  diminished  through 
wise  councils  and  mutual  good  will — risks  such  as  would  change 
as  the  ages  passed.  It  is  a  fair  induction  from  the  actual  and 
unexpected  peacemaking  influences  of  insurance  in  our  present 
social  life,  that  a  form  of  insurance  in  which  the  beneficiaries  be- 
long to  many  different  nations,  and  were  through  the  insurance 
contract  brought  into  constantly  new  and  wholesome  relations, 
would  prove  potent  for  peace  and  good  will,  and  would  tend  to 
make  more  and  more  conscious  from  decade  to  decade,  from  cen- 
tury to  century,  the  Community  of  Mankind. 

I  hope,  therefore,  that  I  am  not  too  intrusive,  if  T  venture,  in 
answer  to  your  kind  appointment,  to  say  to  you  that,  in  my  opin- 
ion, it  would  be  a  very  sad  thing  for  the  World's  Insurance  Con- 


WORLD'S  INSURANCE  CONGRESS       349 

gress  at  San  Francisco  to  let  the  opportunity  go  by  which  this 
extraordinary  union  of  representatives  of  the  potent  principle  of 
insurance  presents — to  let,  I  say,  this  opportunity  go  by  to  discuss 
or  in  some  organized  way  to  consider  the  possibility  of  a  genuine 
and  practicable  beginning  of  some  form  of  international  insur- 
ance. The  moment  is  in  many  waj-s  unique  in  the  world's  historj% 
The  chance  to  make  however  slight  a  first  step  towards  applying 
the  principle  of  insurance  to  international  affairs  is  too  momentous 
for  us  simply  to  neglect  it  without  failing  in  what  I  must  suppose 
to  be  a  genuine  duty. 

I  have  no  right  to  ask  you  to  give  any  close  attention  to  the 
little  book  on  "War  and  Insurance"  which  I  shall  ask  my  pub- 
lisher to  send  to  you  as  soon  as  possible  after  I  dispatch  to  you 
this  letter  and  memorandum.  You  and  others  will,  I  suppose, 
"little  reck  or  long  remember"  what  I  say  in  this  book.  Regard 
it,  I  beg  you,  as  a  first  attempt  on  my  part  to  call  attention  to  a 
subject  which,  I  believe,  must  ere  long  become  of  genuine  inter- 
national importance.  Some  day  the  insurance  principle  will  be- 
gin to  get  a  genuine  and  conscious  and  practicable  international 
application.  When  that  beginning  is  once  made,  the  nations  will 
have  added  a  veiy  potent  influence  towards  peace  to  the  influences 
which  already  exist.  The  process  .of  adding  this  influence  may  be 
slow,  but  whenever  it  begins,  it  will  be  businesslike,  as  well  aa 
ideally  significant.  To  have  suggested  that  the  principle  of  in- 
ternational insurance  can  be  made  practicable,  if  sufficiently  ex- 
pert authorities,  such  as  an  insurance  congress  will  undoubtedly 
bring  together,  give  suitable  attention  to  the  problem — to  have 
suggested  this  must  constitute,  at  best,  a  very  small  service  on 
my  part,  and  may  not  constitute  any  justification  for  the  place 
that  you  have  so  kindly  given  to  my  name  on  your  list  of  members. 
But  to  have  this  possibility  in  mind,  and  to  miss  the  opportunity 
which  your  kind  letter  gives  me  to  call  this  possibility  to  the 
attention  of  yourself,  and  through  you,  of  your  Committee  and 
of  the  Congress,  to  miss  this  opportunity,  would  be  for  me  a 
crime.  Shall  so  many  wise  minds  be  devoted  to  plans  for  the 
peaceful  future  of  the  nations,  shall  these  wise  minds  be  busy  at 
this  tragic  and  fateful  moment  with  such  far-reaching  thoughts, 
and  with  such  problematic  plans  for  international  union  and  con- 
cord as  men  nowadays  discuss,  and  shall  not  one  use  this  oppor- 
tunity to  call  the  attention  of  the  Peace  Committee  of  the  Insur- 
ance Congress  to  the  fact  that  the  insurance  principle  in  its  pres- 
ent form  is  a  gi'eat  peacemaker;  and  that  if  internationally  ap- 
plied, through  the  wisdom  and  counsel  of  wise  insurance  experts, 
it  may  gradually  prove  peacemaking  and  humanizing  over  a  far 
vaster  field  in  the  future? 


350  WORLD'S  INSURANCE  CONGRESS 

WAR,  BUSINESS  AND  INSURANCE 

By  David  Starr  Jordan 
Chancellor,  Leland  Stanford,  Junior,  University 

The  complications  behind  the  war  in  Europe  are  very  many — 
ruthless  exploitation,  heartless  and  brainless  diplomacy,  futile 
dreams  of  national  expansion,  the  restoration  of  a  Holy  Roman 
Empire  with  its  historical  equipment,  temporal  and  spiritual  (the 
"Mirage  of  the  Map"),  of  national  enrichment  through  the  use  of 
force  (the  "Great  Illusion"),  and  withal  a  widespread  vulgar 
belief  in  indemnities  or  highway  robberies  as  a  means  of  enriching 
a  nation. 

All  these  would  represent  only  the  unavoidable  collision,  unrest 
and  ambition  of  human  nature,  were  it  not  that  every  element  in- 
volved in  it  was  armed  to  the  teeth.  "When  blood  is  their  argu- 
ment" in  matters  of  business  or  politics,  all  rational  interests  are 
imperilled.  The  gray  old  strategists  to  whom  the  control  of  arma- 
ment was  assigned  saw  the  nations  moving  towards  peaceful  solu- 
tion of  their  real  and  imaginary  difficulties.  The  young  men  of 
Europe  had  visions  of  a  broader  world,  one  cleared  of  lies  and 
hate  and  the  poison  of  an  ingrowing  patriotism.  After  a  genera- 
tion of  doubt  and  pessimism  in  which  world  progress  seemed  to 
end  in  a  blind  sack,  there  was  rising  a  vision  of  continental 
cooperation,  a  glimpse  of  the  time  when  science,  always  interna- 
tional, should  also  internationalize  the  art  of  living. 

Clearly  the  close  season  for  war  was  near  at  hand.  The  old 
men  found  means  to  bring  it  on  and  in  so  doing  to  exploit  the 
patriotism,  enthusiasm,  devotion  and  love  of  adventure  of  the 
young  men  of  the  whole  world. 

The  use  of  fear  and  force  as  an  argument  in  politics  or  in 
business — this  is  war.  It  is  a  futile  argument  because  of  itself, 
it  settles  nothing.  Its  conclusion  bears  no  certain  relation  to 
its  initial  aim.  It  must  end  where  it  should  begin,  with  an 
agreement  among  the  parties  concerned.  War  is  only  the  blind 
negation,  the  denial  of  all  law,  and  only  the  recognition  of  the 
supremacy  of  some  law  can  bring  war  to  an  end.  In  time  of 
war  all  laws  are  silent  as  are  all  efforts  for  progress,  for  justice, 
for  the  betterment  of  human  kind.  If  histoiy  were  written  truth- 
fully every  page  in  the  story  of  war  would  be  left  blank,  or  printed 
black,  with  only  fine  white  letters  in  the  darkness  to  mark  the 
efforts  for  humanity,  which  war  can  never  wholh^  suppress. 

In  tbis  paper,  I  propose  to  consider  only  economic  eft'ects  of  this 
war  and  with  special  reference  to  the  great  industry  which  brings 
most  of  this  audience  together,  the  business  of  insurance. 

The  great  war  debts  of  the  nations  of  Europe  began  with  rep- 
resentative government.    Kings  borrowed  money  when  they  could, 


WORLD'S  INSURANCE  CONGRESS  351 

bankrupting  themselves  at  intervals  and  sometimes  wrecking  their 
nations.  Kings  have  always  been  uncertain  pay.  Not  many 
loaned  money  to  them  willingly  and  only  in  small  amounts  and 
at  usurious  rates  of  interest.  To  float  a  "patriotic  loan,"  it  was 
often  necessary  to  make  use  of  the  prison  or  the  rack.  With  the 
advent  of  parliaments  and  chambers  of  deputies,  the  credit  of  na- 
tions improved  and  it  became  easy  to  borrow  money.  There  was 
developed  a  special  class  of  financiers,  the  Rothschilds  at  their 
head,  pawnbrokers  rather  than  bankers,  men  able  and  willing  to 
take  a  whole  nation  into  pawn.  And  with  the  advent  of  great 
loans,  as  Goldwin  Smith  wisely  observed,  "there  was  removed 
the  last  check  on  war." 

With  better  social  and  business  adjustments,  and  especially  with 
the  progress  of  railways  and  steam  navigation,  with  other  applica- 
tions of  science  to  personal  and  national  interests,  the  progress  of 
borrowing  became  easier,  as  also  the  payment  of  interest  on 
which  borrowing  depends.  Hence  more  borrowing,  always  the 
easiest  solution  of  any  financial  complication  or  embarrassment. 
Through  the  substitution  of  regular  methods  of  taxation  for  the 
collection  of  tribute,  the  nations  became  solidified.  Only  a  solidi- 
fied nation  can  borrow  money.  The  loose  and  lawless  regions 
called  Kingdoms  and  Empires  under  feudalism  were  not  nations 
at  all.  A  nation  is  a  region  in  which  the  people  are  normally  at 
peace  among  themselves.  In  civil  war,  a  nation's  existence  may 
be  dissolved. 

In  all  the  ages  war  costs  all  that  it  can.  All  that  can  be 
extorted  or  borrowed  is  cast  into  the  melting  pot,  for  the  sake  of 
self-preservation  or  for  the  sake  of  victory.  If  the  nations  had 
any  more  to  give,  war  would  demand  it.  The  King  could  extort, 
but  there  are  limits  to  extortion.  The  nation  could  borrow,  and 
to  borrowing  there  is  but  one  limit  save  the  limit  of  actual  ex- 
haustion. 

Mr.  H.  Bell,  cashier  of  Lloyd's  Bank  in  London,  said  in  1913, 
"The  London  bankers  are  not  lending  on  the  Continent  any  more. 
We  can  see  already  the  handwriting  on  the  wall  and  that  spells 
REPUDIATION.  The  people  of  Europe  will  say,  'We  know  that 
we  have  had  all  this  money  and  that  we  ought  to  pay  interest  on 
it.     But  we  must  live;  and  we  cannot  live  and  pay.'  " 

The  chief  motive  for  borrowing  on  the  part  of  every  nation  has 
been  war  or  preparation  for  war.  If  it  were  not  for  war,  no  na- 
tion on  earth  need  ever  have  borrowed  a  dollar.  If  provinces 
and  municipalities  could  use  all  the  taxes  their  people  pay  for 
purposes  of  peace,  they  could  pay  off  all  their  debts  and  start  free. 
In  Europe,  for  the  last  hundred  years,  in  time  of  so-called  peace, 
nations  have  paid  more  for  war  than  for  anything  else.  It  is  not 
strange,  therefore,  that  this  armed  peace  has  "found  its  verifi- 
cation in  war."    It  has  been  the  "Dry  War,"  the  "Race  for  the 


352       WORLD'S  INSURANCE  CONGRESS 

Abyss,"  which  the  gray  old  strategists  of  the  General  Staff  have 
brought  to  its  final  culmination. 

The  debt  of  Great  Britain  began  with  the  revolution  of  1688, 
with  about  $1,250,000.  This  unpopular  move,  known  as  Dutch 
Finance,  was  the  work  of  William  of  Orange.  Other  loans  fol- 
lowed, based  on  customs  duties  with  "taxes  on  bachelors,  widows, 
marriages  and  funerals,"  and  the  profits  on  lotteries.  At  the  end 
of  the  War  of  the  Revolution  the  debt  reached  $1,250,000,000,  and 
with  the  gigantic  borrowings  of  Pitt,  in  the  interest  of  the  over- 
throw of  Napoleon,  the  debt  reached  its  highest  point  $4,430,- 
000,000.  The  savings  of  peace  duty  reduced  this  debt,  but  the 
Boer  War,  for  which  about  $800,000,000  was  borrowed,  swept  these 
savings  away.  When  the  present  war  began,  the  national  debt  had 
been  reduced  to  a  little  less  than  $400,000,000,  which  sum  a  year 
of  world  war  has  brought  up  to  $11,000,000,000. 

The  debt  of  France  dates  from  the  French  Revolution.  Through 
reckless  management  it  soon  rose  to  $700,000,000,  which  sum  was 
cut  by  paper  money,  confiscation  and  other  repudiations  to  $160,- 
000,000.  This  process  of  easing  the  government  at  the  expense  of 
the  people  spread  consternation  and  bankruptcy  far  and  wide.  A 
great  program  of  public  expenditure  following  a  costly  war  and  its 
soon  paid  indemnity,  raise  the  debt  of  France  to  over  $6,000,- 
000,000.  The  interest  alone  amounted  to  nearly  $1,000,000,000. 
A  year  of  the  present  war  has  brought  this  debt  to  the  unheard  of 
figure  of  about  $12,000,000,000.  Thus  nearly  two  million  bond 
holders  and  their  families  in  and  out  of  France  have  become  an- 
nual pensioners  on  the  public  purse,  in  addition  to  all  the  pen- 
sioners produced  by  war. 

Germany  is  still  a  very  young  nation  and  as  an  empire  more 
thrifty  than  her  largest  state.  The  imperial  debt  was  in  1908  a 
little  over  $1,000,000,000.  The  total  debt  of  the  empire  and  the 
states  combined  was  about  $4,000,000,000  at  the  outbreak  of  the 
war.  It  is  now  stated  at  about  $9,000,000,000,  a  large  part  of 
the  increase  being  in  the  form  of  "patriotic"  loans  from  help- 
less corporations. 

The  small  debt  of  the  United  States  rose  after  the  Civil  War  to 
$2,773,000,000.  It  has  been  reduced  to  about  $915,000,000.  pro- 
portionately less  than  in  any  other  civilized  nation.  The  local 
debts  of  states  and  municipalities  in  this  and  other  countries  are, 
however,  very  large  and  are  steadily  rising.  As  Mr.  E.  S.  IMar- 
tin  observes,  "We  have  long  since  passed  the  simple  stage  of  living 
beyond  our  incomes.  We  are  engaged  in  living  beyond  the  in- 
comes of  generations  to  come." 

Let  me  illustrate  by  a  supposititious  example.  A  nation  has  an 
expenditure  of  $100,000,000  a  year.  It  raises  the  sum  by  taxation 
of  some  sort  and  thus  lives  within  its  means.  But  $100,000,000 
is  the  interest  on  a  much  larger  sum,  let  us  say  $2,500,000,000. 
If,  instead  of  paying  out  a  hundred  million  year  by  year  for  ex- 


WORLD'S  INSURANCE  CONGRESS  353 

penses,  we  capitalize  it,  we  may  have  immediately  at  hand  a  sum 
twenty-five  times  as  great.  The  interest  on  this  sura  is  the  same 
as  the  annual  expense  account.  Let  us  then  borrow  $2,500,000,000 
on  which  the  interest  charges  are  $100,000,000  a  year.  But  while 
paying  these  charges  the  nation  has  the  principal  to  live  on  for 
a  generation.  Half  of  it  will  meet  current  expenses  for  a  dozen 
years,  and  the  other  half  is  at  once  available  for  public  purposes, 
for  dockyards,  for  wharves,  for  fortresses,  for  public  buildings, 
and  above  all  for  the  ever  growing  demands  of  military  conscrip- 
tion and  of  naval  power.  Meanwhile  the  nation  is  not  standing 
still.  In  these  twelve  years  the  progress  of  invention  and  of  com- 
merce may  have  doubled  the  national  income.  There  is  then  still 
another  $100,000,000  yearly  to  be  added  to  the  sum  available  for 
running  expenses.  This  again  can  be  capitalized,  another  $2,500,- 
000,000  can  be  borrowed,  not  all  at  once  perhaps,  but  with  due 
regard  to  the  exigencies  of  banking  and  the  temper  of  the  people. 
"With  repeated  borrowings  the  rate  of  taxation  rises.  Living  on 
the  principal  sets  a  new  fashion  in  expenditure.  The  same  fashion 
extends  throughout  the  body  politic.  Individuals,  corporations, 
municipalities  all  live  on  their  principal. 

The  purchase  of  railways  and  other  public  utilities  by  the  gov- 
ernment tends  further  to  complicate  the  problems  of  national  debt. 
It  is  clear  that  this  system  of  buying  without  paying  cannot  go  on 
indefinitely.  The  growth  of  wealth  and  population  cannot  keep 
step  with  borrowing  even  though  all  funds  were  expended  for 
the  actual  needs  of  society.  Of  late  years  war  preparation  has 
come  to  take  the  lion's  share  of  all  funds  however  gathered,  "con- 
suming the  fruits  of  progress."  What  the  end  will  be,  and  by 
what  forces  it  will  be  brought  about,  no  one  can  now  say.  This 
is  still  a  very  rich  world,  even  though  insolvent  and  under  con- 
trol of  its  creditors.  There  is  a  growing  unrest  among  taxpayers. 
There  would  be  a  still  greater  unrest  if  posterity  could  be  heard 
from,  for  it  can  only  save  itself  by  new  inventions  and  new  ex- 
ploitations, or  by  frugality  of  administration,  of  which  no  nation 
gives  an  example  to-day. 

The  Burden  op  Armament 

Nevertheless  this  burden  of  past  debt,  with  all  its  many  ramifica- 
tions and  its  interest  charges,  is  not  the  heaviest  the  nations  have 
placed  on  themselves.  The  annual  cost  of  army  and  navy  in  the 
world  before  the  war  was  about  double  the  sum  of  interest  paid 
on  the  bonded  debt.  This  annual  sum  represented  preparation  for 
future  war,  because  in  the  intricacies  of  modern  warfare  "hostili- 
ties must  be  begun ' '  long  before  the  materialization  of  any  enemy. 
In  estimating  the  annual  cost  of  war,  to  the  original  interest 
charges  of  upwards  of  $1,500,000,000  we  must  add  yearly  about 
$2,500,000,000  of  actual  expenditure  for  fighters,  guns  and  ships. 
We  must  further  consider  the  generous  allowance  some  nations 


354       WORLD'S  INSURANCE  CONGRESS 

make  for  pensions.  A  large  and  unestimated  sum  may  also  be 
added  to  the  account  from  loss  of  military  conscription,  again  not 
counting  the  losses  to  society  through  those  forms  of  poverty  which 
have  their  primal  cause  in  war.  For  in  the  words  of  Bastiat,  ' '  War 
is  an  ogre  that  devours  as  much  when  he  is  asleep  as  when  he  is 
awake. ' '  It  was  Gambetta  who  foretold  that  the  final  end  of 
annament  rivalry  must  be  "a  beggar  crouching  by  a  barrack 
door." 

When  the  Great  War  began,  the  nations  of  Europe  were  thus 
waist  deep  in  debt.  The  total  amount  of  national  bonded  in- 
debtedness being  about  $30,000,000,000,  or  nearly  three  times  the 
total  sum  of  actual  gold  and  silver,  coined  or  not,  in  all  the  world. 
A  year  of  war  at  the  rate  of  $50,000,000  to  $70,000,000  per  day 
has  increased  this  indebtedness  to  nearly  $50,000,000,000,  the 
bonds  themselves  rated  at  half  or  less  their  normal  value,  w'hile 
the  actual  financial  loss  through  destruction  of  life  and  property 
has  been  estimated  at  upwards  of  $45,000,000,000. 

In  "The  Unseen  Empire,"  the  forceful  and  prophetic  dreams 
of  Mr.  Atherton  Brownell,  the  American  Ambassador,  Stephen 
Channing,  tries  to  show  the  Chancellor  of  Germany  that  war  with 
Great  Britain  is  not  a  "good  business  proposition."  He  says: 
"Our  Civil  War  has  cost  us  to  date,  if  you  count  pensions  for  the 
wrecks  it  left — mental  and  physical — nearly  twenty  billions  of 
dollars.  And  that  doesn't  include  property  losses,  nor  destruction 
of  trade,  nor  broken  hearts  and  desolate  homes — that's  just  cold 
hard  cash  that  we  have  actually  paid  out.  You  can't  even  think 
of  it.  There  have  been  only  about  one  billion  minutes  since  Christ 
w^as  born.  Now  if  there  had  been  four  million  slaves  and  we  had 
bought  every  one  of  them  at  an  average  of  one  thousand  dollars 
apiece,  set  them  free  and  had  no  war,  we  would  have  been  in 
pocket  to-day  just  sixteen  billion  dollars.  That  one  crime  cost  us 
ui  cash  just  about  the  equal  of  sixteen  dollars  a  minute  from  the 
beginning  of  the  Christian  era." 

The  war  as  forecast  in  the  play  is  now  on  in  fact,  and  one  cei-tain 
fact  in  regard  to  it  is  that  it  is  assuredly  not  "a  good  business 
proposition"  for  anybody  in  any  nation  excepting  the  makers  of 
the  instruments  of  death. 

The  actual  war  began,  in  accord  with  Professor  Richet's  calcu- 
lation, at  a  cost  of  $50,000,000  per  day.  Previous  to  this  the  "Dry 
War"  or  "Armed  Peace"  cost  only  $10,000,000  per  day.  This  is 
Richet's  calculation  in  1912,  an  underestimate  as  to  expenses  on 
the  sea  and  in  the  air.  These  with  the  growing  scarcity  of  bread 
and  shrapnel,  the  equipment  of  automobiles,  and  the  unparalleled 
ruin  of  cities  have  raised  this  cost  to  $70,000,000  per  day. 

Daily  cost  of  great  European  AYar   (Charles  Richet.  1012)  : 

Feed  of  men $12,600,000 

Feed  of  horses 1,000,000 


WORLD'S  INSURANCE  CONGRESS  355 

Pay   (European  rates) 4,250,000 

Pay  of  workmen  in  arsenals  and  ports  (100  per  day) .  .  1,000,000 

Transportation   (60  miles  in  10  days) 2,100,000 

Transportation   of   provisions 4,200,000 

Munitions:  Infantry  10  cartridges  a  day 4,200,000 

Artillery :  10  shots  per  day 1,200,000 

]Marine :  2  shots  per  day 400,000 

Equipment    4,200,000 

Ambulances:  500,000  wounded  or  ill  ($1  per  day) ....  500,000 

Warships 500,000 

Reduction  of  imports 5,000,000 

Help  to  the  poor  (20  cents  per  day  to  1  in  10) 6,800,000 

Destruction  of  towns,  etc 2,000,000 

Total  per  day $49,950,000 

This  again  takes  no  account  of  the  waste  of  men  and  horses, 
less  costly  than  the  other  material  of  war  and  not  necessarily  re- 
placed. All  this  is  piled  on  top  of  "the  endless  caravan  of  ciphers" 
($30,000,000,000)  which  represents  the  accumulated  and  unpaid 
war  debt  of  the  nineteenth  century. 

War  is  indeed  the  sport  for  Kings,  but  it  is  no  sport  for  the 
people  Avho  pay  and  die,  and  in  the  long  run  the  workers  of  the 
world  must  pay  the  cost  of  it.  As  Benjamin  Franklin  observed : 
"War  is  not  paid  for  in  war  time;  the  bill  comes  later." 

And  what  a  bill! 

Yves  Cuj'ot,  the  French  Economist,  estimates  that  the  first  six 
months  of  war  cost  Western  Europe  in  cash  $5,400,000,000,  to 
which  should  be  added  further  destruction  estimated  at  $11,600,- 
000,000,  making  a  total  of  $17,000,000,000.  The  entire  amount  of 
coin  in  the  world  is  less  than  $12,000,000,000.  Edgar  Crammond, 
Secretary  of  the  Liverpool  Stock  Exchange,  another  high  authority, 
estimates  the  cash  cost  of  a  year  of  war,  to  August  1st,  1915,  at 
$17,000,000,000,  while  other  losses  will  amount  up  to  make  a 
grand  total  of  $46,000,000,000.  Mr.  Crammond  estimates  that  the 
cost  to  Great  Britain  for  a  year  of  war  will  reach  $3,500,000,000. 
This  sum  is  about  equivalent  to  the  accumulated  war  debt  of  Great 
Britain  for  a  hundred  years  before  the  war.  The  war  debt  of 
Germany  (including  Prussia)  and  that  of  Austria  before  the 
war  was  about  the  same  as  that  of  Great  Britain.  No  one  can 
have  any  conception  of  what  $46,000,000,000  may  be.  It  is  four 
times  all  the  coin  in  the  world.  It  represents,  it  is  stated,  about 
100,000  tons  of  gold.  It  would  probably  outweigh  the  Washington 
monument,  but  we  have  no  data  as  to  what  monuments  weigh, 
though  we  may  try  a  few  calculations.  If  it  were  measured  out  in 
$20  gold  pieces  and  they  were  placed  side  by  side  on  the  railway 
track,  on  each  rail,  they  would  line  with  gold  every  line  from  New 
York  to  the  Pacific  Ocean,   and  there  would  be  enough  left  to 


356  WORLD'S  INSURANCE  CONGRESS 

cover  each  rail  of  the  Siberian  railway  from  Vladivostock  to  Petro- 
grad.  There  would  still  be  enough  left  to  rehabilitate  Belgium  and 
to  buy  the  whole  of  Turkey,  at  her  own  valuation,  wiping  her 
finally  from  the  map. 

Or  we  may  figure  in  some  other  fashion.  The  average  working 
man  in  America  earns  $518  per  year.  It  would  take  ninety  mil- 
lion years'  Avork  to  pay  the  cost  of  the  war;  or  ninety  million 
American  laborers  might  pay  it  oft'  in  one  year,  if  all  their  living 
expenses  were  paid.  The  working  men  of  Europe  receive  from 
half  to  a  third  the  wages  in  America.  They  are  the  ones  who  have 
this  bill  to  pay. 

The  cost  of  a  year  of  the  Great  War  is  a  little  greater  than  the 
estimated  value  of  all  the  property  of  the  United  States  west  of 
Chicago.  It  is  nearly  equal  to  the  total  value  of  all  the  property 
in  Germany  ($48,000,000,000)  as  figured  in  1906.  The  whole 
Russian  Empire  ($35,000,000,000)  could  have  been  bought  for  a 
less  sum  before  the  war  began.  It  could  be  had  on  a  cash  sale 
for  half  that  now.  It  would  have  paid  for  all  the  property  in 
Italy  ($13,000,000,000),  Japan  ($10,000,000,000),  Holland  ($5,- 
000,000,000),  Belgium  ($7,000,000,000),  Spain  ($6,000,000,000) 
and  Portugal  ($2,500,000,000).  It  is  three  times  the  entire 
yearly  earnings  in  wages  and  salaries  of  the  people  of  the  United 
States   ($15,000,000,000). 

We  could  go  on  indefinitely  with  this,  playing  with  figures  which 
nobody  can  understand,  for  the  greatest  fortune  ever  accumulated 
by  man,  in  whatever  fashion,  would  not  pay  for  two  days  of  this 
war. 

The  cost  of  this  war  would  pay  the  national  debts  of  all  the 
nations  in  the  world  at  the  time  the  war  broke  out,  and  this 
aggregate  sum  of  $45,000,000,000  for  the  world  was  all  accumulated 
in  the  criminal  stupidity  of  the  wars  of  the  nineteenth  century. 
If  all  the  farms,  farming  lands,  and  factories  of  the  United  States 
were  wiped  out  of  existence,  the  cost  of  this  war  would  more  than 
replace  them.  If  all  the  personal  and  real  property  of  half  our 
nation  were  destroyed,  or  if  an  earthquake  of  incredible  dimen- 
sions should  shake  down  every  house  from  the  Atlantic  to  the 
Pacific,  the  waste  would  be  less  than  that  involved  in  this  war. 
And  an  elemental  catastrophe  leaves  behind  it  no  costly  legacy  of 
hate.  Even  the  financial  troubles  are  not  ended  with  the  treaty 
of  peace.  The  credit  of  Europe  is  gone,  for  one  does  not  know 
how  long.  Before  the  war,  it  is  said,  there  were  $200,000,000,000 
in  bonds  and  stocks  in  circulation  in  Europe.  Much  of  this  has 
been  sold  for  whatever  it  would  bring.  Some  of  the  rest  is  worth 
its  face  value.  Some  of  it  is  worth  nothing.  In  the  final  adjust- 
ment wlio  can  know  whether  he  is  a  banker  or  a  beggar? 

The  American  Ambassador  was  quite  within  bounds  when  he 
said:  "There  isn't  so  much  money  in  the  world;  you  can't  even 
think  it!" 


WORLD'S  INSURANCE  CONGRESS       357 

Or  we  may  calculate  (with  Dr.  Edward  T.  Devine)  in  a  totally 
different  way.  The  cost  of  this  war  would  have  covered  every 
moral,  social,  economic  and  sanitary  reform  ever  asked  for  in  the 
civilized  world,  in  so  far  as  money  properly  expended  can  com- 
pass such  results.  It  could  eliminate  infectious  disease,  feeble- 
mindedness, the  slums  and  the  centers  of  vice.  It  could  provide 
adequate  housing,  continuity  of  labor,  insurance  against  accident; 
in  other  words,  it  could  abolish  every  kind  of  suffering  due  to 
outside  influences  not  inherent  in  the  character  of  the  person 
concerned. 

A  Russian  writer,  quoted  by  Dr.  John  H.  Finley,  puts  this  idea 
in  a  different  form : 

"Our  most  awful  enemies,  the  elements  and  germs  and  insect 
destroyers,  attack  us  every  minute  without  cease,  yet  we  murder 
one  another  as  if  we  were  out  of  our  senses.  Death  is  ever  on 
the  watch  for  us,  and  we  think  of  nothing  but  to  snatch  a  few 
patches  of  land !  About  5,000,000,000  days  of  work  go  every  year 
to  the  displacement  of  boundary  lines.  Think  of  what  humanity 
could  obtain  if  that  prodigious  effort  were  devoted  to  fighting  our 
real  enemies,  the  noxious  species  and  our  hostile  environment.  We 
should  conquer  them  in  a  few  years.  The  entire  globe  would  turn 
into  a  model  farm.  Every  plant  would  grow  for  our  use.  The 
savage  animals  would  disappear,  and  the  infinitely  tiny  animals 
would  be  reduced  to  impotence  by  hygiene  and  cleanliness.  The 
earth  would  be  conducted  according  to  our  convenience.  In  short, 
the  day  men  realize  who  their  worst  enemies  are,  they  will  fonn 
an  alliance  against  them,  they  will  cease  to  murder  one  another 
like  wild  beasts  from  sheer  folly.  Then  they  will  be  the  true 
rulers  of  the  planet,  the  lords  of  creation." 

"Money  spent  in  warfare,"  says  Robert  L.  Duffus.  "is  not  like 
money  spent  in  other  industries.  It  will  bring  far  more  beastli- 
ness, far  more  injustice,  far  more  tyranny,  far  more  danger  to  all 
that  is  honorable,  generous  and  noble  in  the  world,  far  more  grief 
and  rage  than  money  spent  in  any  other  way.  Not  one  per  cent  of 
the  amount  devoted  to  these  purposes  is,  for  the  end  aimed  at, 
wasted." 

Is  this  war  due  to  rivalry  in  commerce?  Let  us  look  at  the 
business  side  of  it.  Taking  the  net  profits  of  over-seas  trade  as 
stated  by  the  Hamburg- American  Company  a  year  ago,  the  strong- 
est in  the  world,  and  estimating  the  rest,  we  have  something  like 
this : 

During  the  "Dry  War"  the  net  earnings  of  the  German  Mer- 
cantile fleet  were  about  one-third  the  cost  of  the  navy  supposed 
to  protect  it.  It  would  take  seventy  years  of  trade,  on  the  scale 
of  the  last  year  before  the  war,  to  repay  Germany's  expenses  for 
a  year  of  war.  To  make  good  all  the  losses  of  Europe  would  re- 
quire  more  than  one  hundred  years  of  the  over-seas  trading  profits 
of  all  the  world.  War  is  therefore  death  to  trade,  as  it  is  to  every 
other  agency  of  civilization. 


358       WORLD'S  INSURANCE  CONGRESS 

At  the  beginning  of  the  war  the  value  of  stocks  and  bonds  in 
circulation  in  Europe  amounted  to  about  $200,000,000,000.  What 
is  tlie  present  value  of  all  these  certificates  of  ownership?  What 
is  the  present  value  of  any  particular  industrial  plant  or  com- 
mercial venture? 

A  friend  in  London  had  inherited  through  his  German  wife  a 
large  aniline  dye  plant  on  the  Rhine.  He  told  me  recently  that 
he  had  not  heard  one  word  from  it  for  six  months.  What  will 
be  its  value  when  he  hears  from  it?  And  what  certainty  has  he 
as  to  its  ownership? 

We  are  told  by  those  who  look  on  the  surface  of  things  that 
this  war  is  the  outcome  of  commercial  jealousy.  Let  us  look  at 
this,  too,  for  a  moment.  The  two  greatest  shipping  companies  in 
the  world  before  the  war  were  the  Hamburg-American  Company 
and  the  Nord-Deutscher  Lloyd  of  Bremen.  These  companies  had 
grown  strong  because  they  deserved  to  grow.  They  had  attended 
to  their  affairs  both  in  shipment  of  freight  and  transportation  of 
passengers  with  that  minute  attention  to  details  which  is  so  large 
an  element  in  German  success.  The  growth  of  these  companies 
arose  through  American  trade  and  especially  through  trade  with 
Great  Birtain  and  the  British  possessions.  Did  they  clamor  for 
war — a  war,  whatever  else  might  result,  sure  to  cripple  their 
trade  for  a  generation?  It  is  said  that  Ballin,  of  the  Hamburg 
Company,  unable  to  prevent  Great  Britain  from  rising  to  the  de- 
fense of  Belgium,  "went  home  broken-hearted."  Did  Ballin  build 
the  great  Imperator,  costing  $9,000,000— $6,000,000  of  it  borrowed 
money — with  a  view  to  laying  her  off  after  a  few  trips  for  an  in- 
definite period  in  Hamburg?  Did  the  Nord-Deutscher  Lloyd  con- 
template leaving  the  Vaterland  and  the  George  Washington  to  lie 
in  Hoboken  till  they  were  sold  for  harbor  dues? 

Nor  was  the  jealousy  on  the  other  side.  The  growth  of  German 
commerce  concerned  mainly  Great  Britain.  Presumably  it  was 
profitable  on  both  sides,  for  all  trade  is  barter.  In  any  event, 
Great  Britain  has  never  raised  a  tariff  wall  against  it,  never  pro- 
tected her  traders  by  a  single  differential  duty.  She  has  risen 
above  the  idea  that  by  tariff  exactions  the  foreigner  can  be  made 
to  pay  the  taxes.  As  for  envy  of  German  commerce,  when  did 
an  Englishman  envy  anybody  anything? 

Again,  did  the  Cunard  Company  build  her  three  great  steam- 
ships, the  Mauretania,  the  Lusitania,  the  Aquitania  for  the  fate 
which  has  qome  to  them?  In  1914,  I  saw  the  great  Aqidtanm, 
finest  of  all  floating  palaces,  tied  by  the  nose  to  the  wharf  at 
Liverpool,  the  most  sheepish  looking  steamship  I  ever  saw  any- 
where. Out  of  Imr  had  been  taken  $1,250,000  worth  of  plate  glass 
and  plush  velvet,  elevators  and  lounging  rooms — the  requirements 
of  the  tender  rich  in  their  six  days  upon  the  sea.  The  whole  ship 
was   painted  black,   filled   with   coal — to  be  sent   out   to   help   the 


WORLD'S  INSURANCE  CONGRESS  359 

warships  at  sea.    And  for  this  humble  service  I  am  told  she  proved 
unfitted. 

No,  commercial  envy  is  not  a  reason,  rivalry  in  business  is  not 
a  reason,  need  oJ  expansion  is  not  a  reason.  These  are  excuses 
only,  not  causes  of  war.  There  is  no  money  in  war.  There  is  no 
chance  of  highway  robbery  in  the  byways  of  history  which  can 
repay  anything  tangible  of  the  expense  of  the  expedition.  The 
gray  old  strategists  do  not  care  for  this.  It  is  fair  to  them  to  say 
they  are  not  sordid.  They  care  no  more  for  the  financial  exhaus- 
tion of  a  nation  than  for  the  slaughter  of  its  young  men.  "An 
old  soldier  like  me,"  said  Napoleon,  "does  not  care  a  tinker's 
damn  for  the  death  of  a  million  men."  Neither  does  he  care  for 
the  collapse  of  a  million  industrial  corporations. 

Of  the  many  forms  of  business  and  financial  relations  among 
men,  none  is  more  important  than  those  included  under  the  name 
of  Insurance.  Insurance  is  a  form  of  mutual  help.  By  its  in- 
fluence the  effects  of  calamity  are  spread  so  widely  that  they  cease 
to  be  felt  as  calamity.  The  fact  of  death  cannot  be  set  aside,  but 
through  insurance  it  need  not  appear  as  economic  disaster,  only  as 
personal  loss.  Its  essential  nature  is  that  of  social  cooperation 
and  it  furnishes  some  of  the  most  effective  of  bonds  which  knit 
society  together.  As  insurance  has  become  already  an  interna- 
tional function,  its  influence  should  be  felt  continuously  on  the  side 
of  peace.  That  it  is  so  felt  is  the  justification  of  our  meeting 
together  to-day,  as  underwriters  of  insurance  and  as  workers  for 
peace.  The  essence  of  insurance,  as  Professor  Royce  observes,  is 
that  "it  is  a  principle  at  once  peace-making  in  its  general  tendency 
and  business-like  in  its  practicable  special  application.  ...  As  a 
result  of  insurance,  men  gradually  find  themselves  involved  in  a 
social  network  of  complicated  but  beneficent  relations  of  which 
individuals  are  usually  very  imperfectly  aware  but  by  means  of 
which  modern  society  has  been  profoundly  transformed." 

For  life  insurance,  in  general,  is  not  personally  selfish  in  its 
motive.  It  is  essentially  altruistic,  the  effort  of  the  benefit  of  some 
person  beloved  who  is  designated  as  the  Beneficiary.  For  the 
benefit  of  this  surviving  person,  the  efforts  involved  in  the  payment 
of  premiums  are  put  forth,  and  the  insurance  companies  and  their 
underwriters  constitute  the  machinery  by  which  this  unification 
is  given  to  society. 

To  all  the  interests  of  insurance,  the  lawlessness  of  war  is  wholly 
adverse  and  destructive.  Insurance  involves  mutual  trust  and 
trust  thrives  under  security  of  person  and  property.  Insurance 
demands  steadiness  of  purpose  and  continuity  of  law.  In  war,  all 
laws  are  silent.  War  is  the  brutish,  blind  denial  of  law,  only 
admissible  when  all  other  honorable  alternatives  have  been  with- 
drawn—the last  resort  of  "murdered,  mangled  liberty." 

In  its  direct  relation,  war  destroys  those  who  to  the  under- 
writer represent  the  "best  risks,"  the  men  most  valuable  to  them- 


360       WORLD'S  INSURANCE  CONGRESS 

selves  and  thus  most  valuable  to  the  community.  Those  whom 
war  leaves  behind,  to  slip  along  the  lines  of  least  resistance  into 
the  city  slums,  are  the  people  insurance  rarely  reaches,  "War  con- 
fuses the  administration  of  insurance.  Policies  in  war  time  can 
be  written  only  on  a  sliding  scale.  This  greatly  increases  the 
premium  by  reducing  the  final  payments.  Increase  of  rate  of 
premium  must  decrease  business.  War  means  financial  confusion, 
inflated  currency  and  depreciation  of  bonds.  A  currency  which 
fluctuates  demoralizes  all  business  and  war  leaves  no  alternative. 
The  slogan,  "business  as  usual"  in  war  time  deceives  nobody. 
If  it  did,  nobody  would  gain  by  the  deception.  Enforced  loans 
from  the  reserve  fund  of  insurance  companies  to  the  state  mean 
the  depreciation  of  reserves.  The  substitution  of  unstable  gov- 
ernment bonds  means  robbery  of  the  bondholders.  The  yielding 
to  the  state,  by  enforced  "voluntary  action"  of  reserves  of  sav- 
ings banks  and  insurance  companies,  represents  a  form  of  state 
robbery,  now  in  practice  on  the  continent.  Such  funds  are  prob- 
ably never  actually  confiscated  but  held  in  abeyance  until  the 
close  of  the  war.  This  is  another  form  of  the  ever-present  "mili- 
tary necessity,"  which  seizes  men's  property  with  little  more 
compunction  than  it  shows  in  seizing  men's  bodies.  War  condi- 
tions mean  insecurity  of  investment.  In  war,  all  bonds  are  liable 
to  become  "scraps  of  paper,"  and  no  fund  can  be  made  safe.  The 
insurance  investments  in  Europe  have  been  enormously  depleted 
in  worth,  a  reduction  in  market  value  estimated  at  50  per  cent. 

Experts  in  insurance  tell  me  that  in  war  time  certain  policies 
are  written  so  as  to  be  scaled  down  automatically  when  the  holder 
goes  under  the  colors.  Some  are  invalid  in  time  of  war,  and  some 
have  the  clause  of  free  travel  greatly  abridged.  A  few  are  writ- 
ten to  apply  to  all  conditions,  but  on  these  the  rates  of  premiums 
would  naturally  increase.  Companies  generally  refuse  to  pay  un- 
der conditions  not  nominated  in  the  bond,  and  in  general  all  poli- 
cies are  automatically  reduced  to  level  of  war  policies  on  going 
into  war. 

I  am  told  that  some  American  companies  issue  group  policies 
as  for  any  or  all  of  a  thousand  men,  these  not  subject  to  physical 
examination.  The  war  claims  in  Great  Britain  have  been  very- 
heavy,  because  such  a  large  proportion  of  clerks,  artisans,  stu- 
dents and  other  insurable  or  well-paid  men  have  been  first  to  vol- 
unteer. Some  insurance  companies  have  been  much  embarrassed 
by  tlie  general  enlistment  of  their  employees. 

In  fire  insurance,  conditions  are  much  the  same.  All  contracts 
in  foreign  nations  are  held  in  abeyance  until  the  close  of  war. 
Such  companies  doing  business  in  America  are  now  mostly  in- 
corporated as  American. 

In  every  regard,  the  business  of  insurance  is  naturally  allied 
with  the  forces  that  make  for  peace.  War  brings  ruin,  through  in- 
crease of  loans,  through  the  exhaustion  of  reserves  and  the  pre- 


WORLD'S  INSURANCE  CONGRESS  361 

carious  nature  of  investment.  The  same  remark  applies  in  some 
degree  to  every  honorable  or  constructive  business.  If  any  other 
form  of  danger  threatened  a  great  industry,  its  leaders  would  be 
on  the  alert.  They  would  spare  no  money  and  leave  no  stone  un- 
turned for  their  own  protection. 

Towards  war,  business  has  always  shown  a  stupid  fatalism.  War 
has  been  thought  "inevitable,"  coming  of  itself  at  intervals,  with 
nobody  responsible. 

There  could  not  be  a  greater  error.  War  does  not  come  of  itself,' 
nor  without  great  and  persistent  preparation.  A  few  hundred 
resolute  men,  bent  on  war,  headed  by  unscrupulous  leaders  brought 
on  this  war.  The  military  group  of  one  nation  plays  into  the 
hands  of  like  groups  in  other  nations.  To  keep  up  war  agitation 
long  enough,  whether  the  cause  be  real  or  imaginary,  seems  to 
hypnotize  the  public  mind.  The  horrors  of  war  fascinate  rather 
than  repel,  and  thousands  of  men  in  this  land  of  peace  are  ready 
to  fight  in  Europe  to  one  who  dreamed  of  such  a  line  of  action  a 
year  or  two  ago. 

"Eternal  vigilance  is  the  price  of  liberty."  The  interests  in- 
volved should  put  honest  business  on  its  guard.  The  insurance 
men  could  afford  to  maintain  a  hundred  skilful  observers,  men 
wise  in  business  as  well  as  in  International  Law,  and  in  the  man- 
ners and  customs  of  the  people  of  the  world.  A  few  dozen  skil- 
ful politico-military  detectives — Burnses — in  the  interest  of  finance 
might  save  finance  a  billion  dollars.  These  should  watch  the 
standing  incentives  to  war.  They  should  stand  guard  against  the 
influences  that  work  toward  conflict.  They  should  be  not  only 
"firemen  to  be  called  in  to  put  out  the  fire"  but  agents  for  "fire- 
proof building  material"  in  our  national  edifice,  to  stand  at  all 
times  for  the  security  of  business,  the  Sanctity  of  Law,  Order 
and  Peace.  This  kind  of  "preparedness  for  war,"  would  involve 
no  risks  of  conflict,  of  victory  or  defeat. 


ACCEPTANCE  OF  MEDAL:  ADDRESS 

By  E.  E.  Rittenhouse 
President,  Life  Extension  Institute 

Mr.  Commissioner:  The  Life  Extension  Institute,  which  has 
been  honored  with  this  commemorative  medal,  was  organized  for 
the  purpose  of  assisting  in  the  conservation  of  health  and  life. 
The  Chairman  of  its  Board  of  Directors  is  former  President  Wil- 
liam Howard  Taft,  its  consultant  in  sanitation  is  General  William 
C.  Gorgas,  U.S.A.,  the  Chairman  of  its  Scientific  Board  is  Pro- 
fessor Irving  Fisher  of  Yale  University.  Its  Scientific  Reference 
Board  consists  of  nearly  one  hundred  members — eminent  scientists, 


362  TORLD'S  INSURANCE  CONGRESS 

publicists  and  business  men — who  are  concerned  in  the  conserva- 
tion of  health.  These  gentlemen  serve  the  institution  without 
charge,  as  a  donation  to  human  welfare.  Upon  behalf  of  these 
gentlemen,  and  the  other  thousands  of  lay  members  of  the  insti- 
tution, I  accept  this  medal  and  thank  you  most  sincerely,  Mr.  Com- 
missioner,  on   behalf   of   the   institution. 

To-day  we  have  reached  the  most  important  topic  on  the  pro- 
gram of  the  World's  Insurance  Congress.  We  are  now  briefly  to 
consider  the  most  precious  of  all  mortal  blessings — human  life 
itself. 

In  giving  this  subject  a  day  on  the  program  of  the  Congress 
the  Fair  authorities  have  rendered  a  valuable  public  service  by  en- 
couraging the  great  movement  to  prolong  life  and  make  it  more 
livable.  The  thanks  of  the  public  are  especially  due  to  Com- 
missioner W.  L.  Hathaway  for  securing  this  public  recognition  of 
the  work  Insurance  is  doing  in  the  important  field  of  health  and 
life  conservation. 

In  order  to  grasp  the  full  significance  of  what  is  to  be  said  by 
the  eminent  speakers  who  are  to  follow,  let  us  first  firmly  re-affix 
in  our  minds  a  few  fundamentals,  the  vital  importance  of  which 
we  are  prone  to  overlook. 

The  first  and  most  important  item  in  humanity's  bill  of  rights 
is  the  right  to  live,  therefore  it  follows  that  the  first  and  most 
important  function  of  organized  society  is  the  protection  of  the 
lives  of  the  people  who  compose  it.  These  lives  must  be  guarded 
not  merely  from  human  enemies,  but  from  all  enemies,  including 
our  arch  foe,  Disease. 

We  are  all  for  peace  with  honor,  but  to  maintain  such  a  peace 
under  present  world  conditions  proper  measures  for  national  de- 
fense are  necessary.  Our  first  line  of  defense  is,  however,  neither 
guns,  forts,  nor  warships,  but  men — not  merely  brave  men  but 
men  with  the  strength  and  endurance  to  stand  the  stress  and  strain 
of  modern  war.  A  nation  of  soft,  flabby-muscled,  ease-loving,  and 
physically  low-powered  people  cannot  long  endure  in  this  age  of 
reversion  to  the  war-motives  and  methods  of  barbarism.  Upon 
the  health  and  virility  of  the  people  depend  the  security  of  the 
State  and  the  perpetuity  of  the  race. 

But  after  all  our  most  sacred  obligation  to  posterity  is  not 
merely  to  preserve  the  republic,  but  to  conserve  and  upbuild  the 
health  and  strength  of  our  race.  We  must  not  forget  that  the 
battles  of  peace  call  for  health,  strength  and  endurance,  as  well 
as  the  battles  of  war.  If  the  American  people  are  to  adequately 
prepare  not  only  for  national  defense  but  to  continue  the  advance 
of  their  civilization,  they  must  give  consideration  to  the  great 
problem  of  national  vitality.  This  is  of  special  importance  at  this 
time.  A  nation  like  ours,  with  a  declining  birth  rate  and  with 
the  records  indicating  a  decline  in  the  resisting  power  of  the 
heart  and  otiior  vital  organs  to  the  strain  of  life,  and  incidentally 


:WORLD'S  INSURANCE  CONGRESS  363 

with  seventeen  million  unmarried  men  and  women,  cannot  afford 
to  ignore  the  problem  of  life  waste.  But  this  problem  must  be 
approached  in  a  spirit  of  optimism,  for  we  have  learned  by  a 
glorious  experience  that  the  people  can  be  induced  to  guard  them- 
selves against  disease. 

Of  all  the  marvelous  achievements  of  the  past  third  of  a  century 
which  we  find  recorded  or  exhibited  at  this  wonderful  Exposition 
none  is  of  so  far-reaching  importance  to  posterity  as  the  advance 
in  the  science  of  disease  prevention. 

As  a  result  of  the  discovery  of  the  cause  and  the  means  of 
transmitting  tuberculosis  and  typhoid  fever,  the  mortality  from 
these  diseases  has  been  reduced  about  fifty  per  cent  in  thirty-five 
years.  Since  the  introduction  of  antitoxin,  twenty-one  years  ago, 
the  diphtheria  death  rate  has  been  decreased  about  seventy-five 
per  cent,  in  the  area  where  comparative  records  are  available.  A 
remarkable  decline  has  occurred  in  infant  mortality  from  other 
causes,  during  the  same  period.  Smallpox,  the  scourge  of  cen- 
turies, has  been  almost  eliminated  as  a  deadly  disease.  Yellow 
fever  has  been  conquered.  The  means  of  combating  typhus,  ma- 
laria and  other  communicable  diseases  are  known  and  are  being 
applied  more  and  more  as  time  goes  on. 

The  time  is  near  at  hand  when  these  deadly  germ-diseases  that 
have  been  ravaging  humanity  for  ages  will  exist  only  in  history. 

It  is  difficult  indeed  to  measure  the  obligation  which  humanity 
owes  to  such  patient  heroes  of  medicine  and  of  the  laboratory  as 
Jenner,  Pasteur,  Koch,  Lister,  Finlay,  Reed,  Gorgas  and  others 
who,  by  scientific  research,  or  by  developing  the  means  of  apply- 
ing preventive  science,  have  in  recent  years  made  this  wonderful 
advance  possible. 

The  completion  of  the  Panama  Canal  and  the  creation  of  this 
magnificent  Exposition  to  commemorate  it  were  made  possible  by 
the  application  of  the  science  of  disease  prevention  by  Surgeon- 
General  W.  C.  Gorgas  and  his  able  staff.  Without  the  knowledge 
supplied  by  science,  the  completion  of  the  Canal  might  have  been 
deferred  for  years,  if  not  prevented  entirely  by  the  pestilential 
fevers  of  the  Isthmus  which  destroyed  such  enormous  numbers  of 
people  engaged  in  the  French  enterprise. 

The  magnitude  of  the  contribution  of  medical  science  to  human 
happiness  in  this  field  of  disease  prevention  and  in  educating  the 
public  in  the  matter  of  right  living  may  be  appreciated  when  we 
consider  that  on  the  first  of  next  January  there  will  be  alive  in 
the  United  States  approximately  four  hundred  thousand  people 
who  would  have  died  this  year  if  the  death  rate  in  the  registration 
area  of  1880  still  prevailed.  This  means  the  saving  of  a  popula- 
tion nearly  equalling  that  of  San  Francisco  every  year. 

"We  view  with  amazement  the  comforts  and  benefits  that  have 
come  to  mankind  from  modern  invention.  But  how  insignificant 
these  wonders  seem  as  a  means  of  promoting  happiness  when  com- 


364       WORLD'S  INSURANCE  CONGRESS 

pared  with  the  total  sum  of  sickness,  suffering  and  life  waste  which 
has  been  prevented  for  all  time  by  these  men  of  science. 

Consider  the  number  of  descendants  of  this  vast  multitude  of 
lives  wliich  are  saved  annually.  Think  of  the  millions  of  souls, 
the  millions  of  productive,  useful  lives,  that  will  come  to  this  good 
eartli  on  down  the  ages  as  a  result  of  these  life-saving  achieve- 
ments. The  men  of  the  medical  profession  take  a  broad  and  noble 
view  of  their  duty  to  humanity.  They  are  steadily  increasing  their 
efforts  to  prevent  sickness  regardless  of  the  fact  that  they  are  sup- 
posed to  earn  their  daily  bread  by  treating  it.  It  is  well  to  re- 
member this. 

The  most  appropriate  and  lasting  monument  which  we  could 
erect  in  honor  of  these  benefactors  of  mankind  would  be  to  en- 
large and  make  permanent  the  great  modern  movement  to  prevent 
needless  sickness  and  premature  death,  not  only  from  communi- 
cable disease,  but  from  organic  disease,  for  notwithstanding  their 
success,  life  waste,  especially  in  the  United  States,  is  still  excessive 
from  both  these  classes  of  diseases. 

The  life  waste  in  modern  war,  enormous  as  it  is,  is  almost  tri- 
fling when  compared  to  the  needless  sacrifices  of  life  in  peace,  from 
ignorance  and  neglect  of  ordinary  preventive  measures. 

It  is  estimated  that  we  lose  every  day  nearly  two  thousand 
American  lives  from  preventable  disease.  During  the  past  ten 
years,  we  have  lost  over  six  million  lives  from  preventable  cause, 
and  this  waste  will  continue  during  all  future  decades  unless  a 
more  rigorous  effort  is  made  to  apply  the  knowledge  which  we  have 
already  gained  to  check  this  loss. 

Here  in  California,  notwithstanding  the  steady  influx  of  invalids 
from  other  States,  the  mortality  is  very  low  compared  with  that  of 
the  Eastern  section  of  our  country,  and  the  same  may  be  said  of 
San  Francisco,  when  compared  with  many  Eastern  cities.  But 
making  due  allowance  for  the  outsiders  who  swell  the  mortality 
in  this  State,  there  are  at  least  twelve  thousand  preventable  deaths 
occurring  in  California  every  year.  In  the  State  of  New  York  it 
is  about  six  thousand  annually. 

No  city,  no  State,  is  so  healthful  that  it  can  afford  to  ignore 
the  urgent  need  for  increasing  its  efforts  to  prolong  the  productive 
useful  years  of  life,  and  the  appropriation  of  public  funds  should 
steadily  increase  for  this  purpose.  Philanthropy  should  do  its 
part.  At  the  present  time,  it  is  our  habit  to  wait  until  disease  at- 
tacks us  before  calling  on  medical  science  for  relief.  Under  the 
new  plan  we  will  also  use  the  doctor  to  help  keep  us  from  getting 
sick.  It  is  just  beginning  to  dawn  upon  us  that  if  it  is  worth  while 
to  relieve  physical  suffering  it  is  certainly  worth  while  to  prevent 
it.  Health  i'»  the  keystone  of  the  beautiful  arch  of  human  exist- 
ence; every  consideration  of  humanity  and  patriotism  demands 
that  it  be  religiously  conserved. 

In  this  great  field  of  social  service  Insurance  has  played  an  im- 


WORLD'S  INSURANCE  CONGRESS  365 

portant  part.  It  has  taught  us  to  place  a  higher  value  upon  hu- 
man life.  The  fire  insurance  companies  have  contributed  to  the 
saving  of  life  by  their  campaign  to  prevent  fire  waste.  The  casu- 
alty companies  have  interested  themselves  in  the  prevention  of 
accidents,  and  certain  life  insurance  companies  are  already  helping 
in  the  general  campaign  of  health  education.  An  idea  may  be 
gained  of  the  influence  that  insurance  has  experienced  in  stimu- 
lating the  growing  sentiment  in  favor  of  health  and  life  conserva- 
tion by  reflecting  for  a  moment  on  the  fact  that  the  twenty-five 
million  life  insurance  policyholders  now  in  old  line  companies  have 
each  been  obliged  to  pass  a  successful  medical  examination.  In 
addition  to  this,  millions  have  been  declined  for  physical  impair- 
ments in  the  last  fifty  years.  All  these  examinations  have  done 
much  to  arouse  people  to  a  proper  appreciation  of  the  value  of 
their  health  and  have  stimulated  them  to  adopt  means  of  protect- 
ing it.  A  vast  number  of  these  people  thus  learned  for  the  first 
time  of  physical  impairments  and  took  advantage  of  this  knowl- 
edge to  have  them  corrected.  In  a  sense,  this  requirement  of  medi- 
cal examination  has  had  the  effect  of  establishing  a  standard  of 
health,  for  it  is  a  common  practice  for  people  to  judge  of  their 
physical  condition  by  their  ability  to  get  life  insurance. 

While  this  great  social  service  has  been  rendered  in  the  ordinary 
course  of  business,  yet  the  health  and  life  saving  that  has  resulted 
is  none  the  less  genuine,  A  full  measure  of  credit  is  due  to  the 
insurance  companies  and  their  medical  men  who  have  made  this 
and  many  other  substantial  contributions  to  the  happiness  of  hu- 
manity, all  of  which  adds  to  the  glory,  progress  and  grandeur  of 
our  country. 

I  now  have  pleasure  in  introducing  Mr.  Willard  Done,  member 
of  the  Executive  Committee  of  the  World 's  Insurance  Congress. 


INSURANCE  AND  THE  CONSERVATION  OF 
HUMAN  LIFE 

By  Dr.  Frederick  L.  Hoffman 
Statistician,  The  Prudential  Insurance  Company  of  America 

The  modern  world  of  trade,  transportation  and  insurance  is  no 
longer  limited  to  itself  as  a  field  of  private  enterprise  entirely 
separate  and  distinct  from  the  larger  sphere  of  political,  social 
and  economic  activity.  Modern  business  in  all  its  branches  is  now 
so  largely  under  the  direct  or  indirect  supervision  and  control  of 
government — Federal,  State  and  municipal — that  many  of  its  most 
important  functions  and  purposes  have  gradually  passed  over  the 
formerly  well  marked  boundary  line  between  private  enterprise 
and  public  service.     This  extremely  significant  conclusion  applies 


366  WORLD'S  INSURANCE  CONGRESS 

with  special  force  to  the  broadening  scope  of  insurance  as  a  uni- 
versal provident  institution  and  its  direct  or  indirect  relation  to 
public  welfare  best  visualized  in  the  deliberate  effort  at  the  con- 
servation of  human  life  and  health. 

The  true  measure  of  modern  civilization  is  not  necessarily  or 
essentially  the  development  of  the  sciences  and  arts  to  even  their 
highest  degree  of  attainable  perfection  in  the  direction  of  utility, 
but  rather  the  more  or  less  complete  elimination  of  chance  occur- 
rences from  the  lives  and  daily  activities  of  the  people.  Measur- 
able progress  in  civilization  consists  largely  in  the  attainment  of 
the  highest  degree  of  social  and  economic  security,  and  as  said 
many  years  ago  in  the  classical  report  of  the  first  parliamentary 
committee  on  friendly  societies,  "Wherever  there  is  a  contingency, 
the  cheapest  way  of  providing  against  it  is  by  uniting  with  others, 
so  that  each  man  may  subject  himself  to  a  small  deprivation  in 
order  that  no  man  may  be  subjected  to  a  great  loss." 

This  is  the  fundamental  principle  of  all  insurance,  but  it  re- 
quires to  be  qualified  by  the  statement  that  an  infinitely  more 
effective  method  of  human  betterment  lies  in  the  direction  of  pre- 
vention rather  than  in  the  payment  of  indemnity  or  pecuniary  com- 
pensation for  the  consequences  which  arise  out  of  the  multitude  of 
uncertainties  of  human  life.  In  other  words,  in  proportion  as 
mankind  advances,  the  apparent  uncertainties  or  chance  contin- 
gencies are  reduced  to  a  minimum  by  the  persistent  and  rational 
application  of  a  broadening  intelligence  to  practical  questions  of 
safety  and  health  which  imperatively  demand  a  successful  solu- 
tion. In  no  direction  is  the  evidence  of  measurable  human  prog- 
ress more  incontrovertibly  conclusive  than  in  the  deliberate  and 
successful  modern  control  of  the  human  death  rate  Avhieh  in  a 
single  generation  has  been  reduced  in  a  considerable  degree.  Some 
of  the  most  destructive  diseases,  such  as  cholera  and  yellow  fever, 
have  been  practically  eliminated  from  civilized  countries,  while 
other  plagues  of  mankind,  such  as  smallpox,  tuberculosis  and  ty- 
phoid fever,  are  now  decidedly  less  common  and  distinctly  less  of 
a  menace  than  in  former  times.  The  aggregate  saving  in  human 
life,  health  and  strength  through  the  combined  efforts  of  public 
health  organizations  and  private  health-promoting  agencies  is  be- 
yond all  calculation  and  outside  of  even  the  range  of  intelligent 
conjecture.  What  has  been  done  through  these  agencies  is  quite 
generally  recognized  by  qualified  authorities  as  a  contribution  of 
the  first  order  of  importance  to  the  cause  of  human  welfare,  but  it 
is  not  so  well  realized  that  substantial  aid  in  this  direction  has  also 
been  rendered  by  insurance  in  all  its  important  branches,  directly 
or  indirectly  as  the  case  may  be. 

It  is  the  purpose  of  this  address  to  present  in  brief  outline  the 
salient  facts  of  these  secondary  a.spects  of  insurance  which  on  this 
memorable  occasion  in  connection  with  the  Panama-Pacific  Inter- 
national PLxposition  has  for  the  first  time  in  insurance  histoiy  re- 


WORLD'S  INSURANCE  CONGRESS       367 

ceived  proper  and  adequate  public  consideration,  not  only  as  a  uni- 
versal provident  institution  of  the  highest  economic  importance, 
but  also  as  an  element  of  progress  in  the  physical,  the  mental  and 
the  moral  improvement  of  the  human  race. 

Life  Insurance 

Of  the  several  important  branches  of  insurance,  it  seems  but 
fitting  on  this  occasion  that  first  consideration  should  be  given 
to  life  insurance  in  its  direct  or  indirect  relation  to  the  conserva- 
tion of  human  life.  Life  insurance  practice  rests  upon  the  funda- 
mental principle  of  the  average  duration  of  human  existence,  and 
throughout  its  long  and  honorable  history  the  most  useful  con- 
tributions to  the  study  of  longevity  have  developed  out  of  the  ex- 
perience of  the  life  insurance  companies  of  the  world.  The  prog- 
ress of  the  science  of  life  contingencies  practically  coincides  with 
the  origin  and  gradual  development  of  life  tables  which  measure 
with  a  sufficient  degree  of  accuracy  the  average  duration  of  human 
life.  The  famous  Breslau  table  of  mortality  was  constructed  in 
the  3^ear  1693  by  the  great  astronomer  Edmund  Halley  for  the 
primary  purpose  of  providing  a  scientific  basis  for  the  correct  as- 
certainment of  the  cost  and  the  principles  of  premium  calculation 
in  the  insurance  of  lives.  The  changes  in  longevity  during  long 
intervening  periods  of  time  are  measurable  only  with  the  required 
accuracy  by  means  of  life  tables,  not  only  for  the  population  at 
large,  but  also  for  special  classes  and  limited  geographical  areas 
of  the  earth's  surface.  No  evidence  regarding  existing  defects  in 
the  social  economy  of  the  people  is  more  conclusive  than  an  exces- 
sive death  rate,  but  this  conclusion  applies  with  special  force  to 
a  high  mortality  of  men  employed  in  dangerous  and  unhealthy 
trades  and  of  women  and  children  in  unsuitable  occupations  or 
at  hours  incompatible  with  their  nature  and  physical  strength. 
Life  tables  as  thus  originated  and  developed  by  life  insurance  prac- 
tice, therefore,  assist  substantially  in  promoting  the  general  wel- 
fare of  society. 

The  basis  of  practically  every  life  insurance  contract  is  a  quali- 
fied medical  and  physical  examination.  As  well  said  in  this  con- 
nection by  the  former  insurance  commissioner  of  Wisconsin.  ]\Ir. 
H.  L.  Ekern,  "A  practice  so  general  must  be  based  on  sound  rea- 
sons, and  the  experience  of  American  life  insurance  shows  that  in 
respect  to  the  selection  of  its  risks  it  is  on  an  absolutely  sound 
basis,  and  for  this  purpose  the  requirement  of  a  medical  examina- 
tion is  one  of  the  fundamentals  of  sound  life  insurance." 

The  rejection  rate  in  ordinary  life  insurance  is  from  about  12 
to  20  per  cent  of  the  applications  purposed  for  acceptance.  In 
countless  instances,  physical  defects  or  latent  diseases  are  first  dis- 
closed by  the  medical  examination  and  brought  to  the  attention 
of  the  person  examined.  Insurance  medicine  has  become  an  im- 
portant branch  of  medical  science,  and  particularly  in  the  diree- 


368       WORLD'S  INSURANCE  CONGRESS 

tiou  of  the  reasonably  certain  ascertainment  of  physical  defects 
and  existing  diseases  in  their  initial  and  often  readily  curable 
stage.  The  more  modern  but  decidedly  promising  development  of 
a  plan  of  deliberate  life  extension  rests  fundamentally  upon  the 
basis  of  a  thorough  medical  examination  and  periodical  re-examina- 
tion of  life  insurance  policyholders  in  conformity  to  the  logical 
conclusion  that  as  a  general  rule  intelligent  men  and  women  will 
make  their  bodily  conduct  and  care  coraform  to  their  understand- 
ing of  what  is  prerequisite  for  the  attainment  of  the  highest  de- 
gree of  health,  physical  efficiency  and  consequential  longevity. 

The  standard  life  insurance  premium  is  based  upon  the  law 
of  mortality  in  conformity  to  the  statistical  law  of  average.  The 
standard  premium,  however,  applies  only  to  the  insurance  of  aver- 
age or  normal  lives.  As  a  useful  compromise  between  unconditional 
rejection  of  applicants  not  precisely  -conforming  to  this  stand- 
ard, special  classes  of  risks  or  sub-standard  lives  are  diiferently 
provided  for  by  means  of  a  scientifically  developed  rating  prac- 
tice. Obvious  variations  in  the  mortality  rate  from  the  accepted 
normal  standard  have  practically  from  the  commencement  of  life 
insurance  experience  demanded  separate  consideration.  This  con- 
clusion applies  particularly  with  regard  to  extra  premium  charges 
on  account  of  employment  in  dangerous  and  unhealthy  occupa- 
tions as  well  as  to  questions  of  residence  in  sub-tropical  or  tropical 
regions  and  the  insurance  of  native  races  and  certain  foreign  ele- 
ments of  recent  settlement  in  the  United  States.  The  enormous 
disparity  in  race  mortality  is  best  illustrated  by  the  statement  that 
while  in  the  registration  area  of  the  United  States  the  mortality 
of  the  white  race  is  14  per  thousand,  the  corresponding  death  rate 
of  the  colored  race  is  23.  The  principal  reason  for  this  material 
difference  is  the  excessive  loss  of  life  from  tuberculosis  among 
the  Negro  race,  or,  precisely,  in  thirty  Southern  cities  of  this  coun- 
try the  tuberculosis  death  for  the  White  population  is  16  per  10,000 
population  against  but  45  for  the  colored!  Such  differences  as 
these  obviously  require  consideration  in  life  insurance  practice, 
and  some  of  the  most  serious  health  problems  have  been  con- 
cretely brought  first  to  public  attention  by  the  rating  practices  of 
the  companies  upon  the  basis  of  observed  experience  and  extended 
supplementary  scientific  research  work. 

By  far  the  most  important  scientific  and  practical  contribution 
towards  a  better  understanding  of  the  more  pressing  problems 
of  human  longevity  as  determined  by  special  circumstances  or 
conditions,  whethei-  inherent  oi-  external  is  the  medico-actuarial 
investigation  recently  completed  by  American  life  insurance  com- 
panies and  published  in  five  large  volumes  in  the  furtherance  of 
life  insurance  science  and  the  interests  of  the  medical  profession 
and  the  general  public.  Among  the  new  facts  disclosed  is  much 
useful  information  on  the  correlation  of  height  and  weight  to  mor- 
tality; of  the  variations  in  the  death  rate  according  to  occupa- 


WORLD'S  INSURANCE  CONGRESS  369 

tion,  chiefly,  of  course,  in  the  dangerous  and  unhealthy  trades; 
the  approximate  ascertainment  of  the  relative  significance  of  dif- 
ferent degrees  of  physical  impairment  and  pre-existing  disease, 
and  last  but  not  least,  the  variation  in  the  death  rate  of  particular 
localities  and  geographical  sections  which  in  such  a  vast  country 
as  ours  is  naturally  a  matter  of  much  serious  concern.  When  in 
due  course  of  time  the  results  of  this  investigation  become  more 
thoroughly  understood  and  applied  in  the  practice  of  medicine  and 
public  health  administration  a  vast  amount  of  direct  benefit  must 
result  to  the  public  at  large. 

Life  insurance  policies  as  a  rule  contain  a  clause  limiting  by 
special  conditions  the  liability  of  the  insurance  company  with  re- 
gard to  military  service  on  the  part  of  the  insured  in  the  event 
of  war.  Standard  premium  rates  are  based  on  the  mortality  ex- 
perience observed  during  normal  periods  of  time,  and  the  mortality 
rate  as  thus  determined  does  not  include  the  practically  incal- 
culable hazard  of  modern  war.  From  time  to  time  the  life  insur- 
ance companies  have  made  investigations  to  determine  the  increase 
in  mortality  in  consequence  of  more  or  less  prolonged  military 
operations,  but  the  best  evidence  of  the  futility  of  precise  calcu- 
lations is  furnished  by  the  enormous  loss  of  life  in  the  existing 
European  War.  The  only  protection  of  life  companies  against 
such  calamities  is  a  policy  provison  to  the  effect  that  in  the  event 
of  death  in  consequence  of  military  service,  only  the  accumulated 
reserve  will  be  paid  to  the  beneficiary  of  the  insured.  Regardless 
of  this  precaution,  there  are  often  special  occasions  which  require 
a  modification  of  the  rules  in  actual  practice  and  every  war  results 
in  losses  which  make  it  of  the  first  order  of  importance  to  life 
insurance  companies  that  they  should  extend  the  fullest  coopera- 
tion towards  all  efforts  in  behalf  of  the  cause  of  universal  peace. 
The  extra  mortality,  however,  is  not  the  only  serious  factor,  for 
in  addition  there  is  almost  invariably,  on  the  one  hand,  an  im- 
pairment in  the  value  of  securities  which  constitute  the  policy  re- 
serve, and  on  the  other,  an  increase  in  the  burden  of  taxation.  In 
the  future  reorganization  of  international  society,  the  insurance 
companies  throughout  the  world  should  be  in  a  position  to  exercise 
directly  and  indirectly  a  profound  and  far-reaching  influence  in 
the  adoption  of  a  working  plan  for  the  pacific  settlement  of  all 
international  dispute  and  in  the  required  modification  of  the  laws 
and  customs  of  war  by  land  and  water  to  reduce  the  loss  of  life, 
at  least  of  non-combatants,  to  a  minimum. 

Industrial  Insurance 

Within  the  last  forty  years  there  has  been  developed  in  this 
country  and  during  an  earlier  or  later  period  in  most  other  civi- 
lized countries,  a  system  of  industrial  insurance  on  the  weekly 
premium  payment  plan,  for  the  economic  protection  of  wage  earn- 
ers and  their  families,  which  has  become  extremely  popular  and 


370  WORLD'S  INSURANCE  CONGRESS 

widely  diffused.  Throughout  the  United  States  and  Canada  there 
are  now  more  than  thirty  million  industrial  policies  in  force. 
Aside  from  the  indirect  social  value  of  this  form  of  insurance  as 
an  essential  education  in  systematic  habits  of  saving,  is  the  direct 
advantage  of  a  more  or  less  adequate  pecuniary  provision  for  the 
needs  of  the  famil}'  during  what  is  often  a  period  of  serious  eco- 
nomic distress.  In  the  development  of  industrial  insurance,  it  was 
early  found  possible  to  encourage  a  broadening  of  the  saving  func- 
tion, and  a  vast  amount  of  ordinary  insurance  is  now  written 
on  the  lives  of  industrial  policyholders,  to  the  incalculable  advan- 
tage of  society  and  the  state.  The  annual  mortality  experience  of 
industrial  companies  is  thoroughly  representative  of  the  country 
at  large,  and  the  facts  of  this  expei'ieiice  on  many  important  occa- 
sions have  been  of  considerable  practical  advantage  to  the  general 
public  and  the  government  in  the  furtherance  of  welfare  efforts 
of  many  kinds. 

Perhaps  the  most  important  service  rendered  by  the  qualified 
analysis  of  this  mortality  experience  has  been  in  the  direction  of 
the  more  precise  ascertainment  of  occupational  hazards  and  the 
determination  of  excessive  disease  frequency  in  unhealthy  trades. 
The  contributions  which  have  been  made  by  industrial  insurance 
companies  to  this  important  branch  of  preventive  medicine  are 
of  the  first  order  of  importance  and  they  have  been  so  recognized 
by  public  health  authorities  throughout  the  world.  Some  of  the 
most  useful  publications  on  industrial  accidents  and  industrial 
diseases  have  come  from  the  scientific  departments  of  industrial 
companies,  and  special  mention  may  here  be  made  of  the  valuable 
assistance  rendered  by  these  useful  institutions  in  the  development 
of  the  tuberculosis  movement,  the  industrial  safety  movement,  the 
prevention  of  infant  mortality,  and  last,  not  least,  the  control  of 
cancer.  While  so  much  has  been  done  and  with  such  far-reaching 
results,  it  is  a  foregone  conclusion  that  the  future  will  witness  a 
material  broadening  of  the  scientific  research  work  and  active 
cooperation  on  the  part  of  industrial  companies  in  the  conservation 
of  human  life. 

But  industrial  insurance  has  done  still  more.  Through  the 
agency  organization  of  these  companies,  a  truly  enormous  amount 
of  thoroughly  well  considered  public  health  literature  has  been 
distributed,  and  effective  aid  has  occasionally  been  rendered  to 
public  authorities  in  connection  with  efforts  at  local  sanitary  im- 
provement and  the  control  of  disease.  There  has  been  no  dupli- 
cation of  effort  on  the  part  of  the  different  companies  and  some 
have  specialized  in  one  direction  of  public  welfare  work,  while 
others  have  concentrated  their  efforts  upon  different  fields.  The 
most  hearty  spirit  of  cooperation  prevails  and  there  is  hardly  an 
international,  National  or  State  public  health  movement  or  a  corre- 
lated effort  of  private  health  promoting  agencies  in  which  these 
companies  have  not  been  of  substantial  assistance.    They  have  pro- 


"WORLD'S  INSURANCE  CONGRESS  371 

vided  method  and  means  for  more  qualified  statistical  analysis  and 
scientific  research  in  the  reform  of  hospital  statistics,  autopsy  rec- 
ords, the  experience  data  of  visiting  nurse  associations,  etc.,  etc. 
All  of  this  direct  or  indirect  assistance  must  naturally  have  been 
of  considerable  value  to  the  nation-wide  movement  in  the  direction 
of  a  betterment  of  living  conditions  and  as  the  first  prerequisite 
thereof,  the  deliberate  prevention  of  disease  and  the  prolongation 
of  life. 

The  Social  Economy  of  Life  Insurance 

In  its  origins,  life  insurance  was  largely  in  the  form  of  annui- 
ties, whether  immediate  or  deferred.  The  difference  between 
annuities  and  the  usual  life  insurance  policy  is  that  under  the 
former  a  certain  sum  is  payable  annually  or  at  shorter  intervals  to 
the  beneficiary  for  the  remainder  of  life  or  a  stated  period  thereof, 
while  in  general  life  insurance  practice  a  lump  sum  is  payable  in 
the  event  of  the  death  of  the  insured.  Within  recent  years,  it  has 
been  realized  that  a  combination  of  the  two  functions  would  best 
serve  the  interests  of  the  beneficiaiy  in  at  least  a  very  considerable 
proportion  of  cases  where  the  proceeds  of  the  policy  constitute 
practically  the  entire  estate  left  by  the  deceased  to  survivors  at  his 
death.  A  new  principle  has,  therefore,  been  evolved  and  become 
known  as  the  ' '  Installment  Provision, ' '  under  which  the  sum  pay- 
able at  death  or  policy  maturity  is  paid  out  in  stipulated  portions, 
but  usually  on  a  monthly  basis.  In  industrial  insurance,  a  method 
has  been  perfected  for  the  payment  of  installments  on  a  weekly 
basis,  so  as  to  conform  to  the  different  economic  necessities  of  the 
dependent  survivors  of  the  insured. 

The  monthly  income  principle  best  emphasizes  the  truly  enor- 
mous social  value  of  insurance  as  a  pecuniary  protection  against 
want  and  dependency.  It  has  been  the  invariable  experience  under 
annuity  contracts  that  the  actual  average  after-life-time  of  the 
insured  was  in  excess  of  the  expected,  on  the  basis  of  existing 
tables.  The  explanation  is  not  difificult  to  find.  A  small,  but  se- 
cure income  for  the  remainder  of  life  is  one  of  the  most  certain 
means  of  prolonging  life  in  old  age.  The  absence  of  worry,  the 
availability  of  means  for  proper  medical  and  surgical  aid,  the  ab- 
sence of  physical  want,  and  many  other  conditions  naturally  tend 
to  bring  about  this  result.  The  evidence  is,  therefore,  quite  con- 
clusive that  life  insurance,  directly  as  well  as  indirectly,  advances 
the  cause  of  human  longevity.  Of  course,  it  will  never  be  feasible 
to  calculate  even  approximately  the  money  value  of  life  insurance 
in  promoting  the  cause  of  life  conservation,  but  it  is  beyond  con- 
troversy that  millions  of  lives  have  been  preserved  and  other  mil- 
lions of  lives  have  been  safeguarded  through  the  direct  benefits  of 
life  insurance  which  could  not  have  been  replaced  by  any  other 
method  of  individual  or  collective  thrift ;  and  countless  years  of  life 
must  have  been  added  to  the  aggregate  span  of  human  existence 
because  of  these  benefits  which  reflect  the  highest  form  of  altruism 


372  WORLD'S  INSURANCE  CONGRESS 

attainable  by  the  individual  in  his  relation  to  the  society  of  which 
he  is  a  part. 

Fraternal  Insurance 

Within  recent  years  the  larger  and  more  substantial  fraternal 
organizations,  as  well  as  the  benefit  funds  of  certain  national  and 
international  labor  organizations,  have  developed  apparently  quite 
successful  methods  of  institutional  treatment  for  members  afflicted 
with  tuberculosis,  and  in  a  few  cases  with  other  diseases  also.  In 
some  rather  conspicuous  instances,  the  sanatoria  treatment  has 
been  carried  to  a  remarkable  degree  of  perfection  with  a  far-reach- 
ing effect  upon  the  general  health  conservation  movement.  The 
economic  results  have  perhaps  been  most  satisfactory  where  insur- 
ance methods  have  been  effectively  combined  with  the  more  general 
objects  of  organized  labor  for  the  deliberate  purpose  of  improving 
the  social  and  economic  standard  of  the  wage  earners'  life.  Per- 
haps no  other  form  of  organization  is  so  well  qualified,  on  account 
of  its  direct  personal  relation  to  its  membership,  to  foster  and  aid 
the  health  conservation  and  accident  prevention  movement  in  co- 
operation with  the  public,  corporate  and  private  health-producing 
agencies. 

Sickness  and  Health  Insurance 

So-called  sickness  and  health  insurance  has  not  been  developed, 
in  this  country  at  least,  to  the  large  extent  desirable  as  a  matter 
of  public  policy.  Wage  earners'  sickness  insurance  at  the  present 
time  is  often  obtainable  only  through  small  societies  with  premium 
charges  based  upon  a  more  or  less  untrustworthy  experience. 
Some  progress  has  been  made  in  recent  years,  however,  and  what 
is  generally  called  health  insurance  has  been  developed  in  con- 
formity to  scientific  principles  by  well  managed  personal  accident 
insurance  companies.  The  increasing  practice  of  including  a  dis- 
ability provision  in  the  life  insurance  contract  issued  by  legal  re- 
serve companies  may  here  be  referred  to  as  another  step  in  the 
right  direction.  A  large  amount  of  qualified  medical  and  hospital 
protection  is  provided  for  on  the  basis  of  more  or  less  arbitrary 
monthly  premium  charges  for  employees  of  large  corporations 
chiefly  engaged  in  mining,  lumbering  and  other  dangerous  indus- 
tries. An  inestimable  amount  of  good  has  been  done  by  these  sim- 
ple forms  of  insurance  operating  along  a  line  thus  far  found  diffi- 
cult of  development  by  large  insurance  companies. 

The  so-called  friendly  and  fraternal  societies  which  provide  sick- 
ness insurance  for  their  membership  have,  collectively  considered, 
been  of  great  practical  value  in  determining  the  approximate  rate 
of  sickness  frequently  among  different  classes  of  the  population, 
with  a  due  regard  to  age,  sex.  occupation  and  locality.  Such  data 
as  have  been  made  available  are  of  gi-eat  value  in  connection  with 
efforts  to  bring  about  a  more  thorough  understanding  of  the  prac- 
tical utility  and  public  importance  of  sickness  prevention  and  con- 


WORLD'S  INSURANCE  CONGRESS  373 

trol.  Some  extremely  useful  data  in  this  connection  have  been  de- 
rived from  a  special  analysis  of  the  experience  of  large  hospitals 
and  visiting  nurse  associations  under  the  direction  of  the  statisti- 
cal officers  of  industrial  insurance  companies.  As  yet,  the  gen- 
eral law  of  sickness  and  its  modification  by  special  conditions  is 
still  quite  imperfectly  understood,  but  as  a  pertinent  illustration 
of  the  practical  utility  of  available  information,  reference  may  be 
made  to  the  historical  fact  that  the  experience  of  the  Manchester 
Order  of  Unity  of  Odd  Fellows  was  made  the  basis  of  the  truly 
colossal  national  health  insurance  system  of  the  United  Kingdom. 
The  sickness  experience  data  of  the  mining  branches  of  Friendly 
Societies  have  been  employed  to  good  advantage  in  suggesting  the 
qualified  study  of  mine  sanitation.  The  experience  data  of  in^ 
surance  organizations  of  railway  employees  have  drawn  attention 
to  the  hazardous  nature  of  this  important  group  of  public  employ- 
ments. The  truly  astonishing  waste  of  human  energy  and  strength 
caused  by  needless  sickness  and  preventable  accidents  involving 
temporary  or  permanent  disability  is  only  measurable  by  means 
of  statistics  derived  to  best  advantage  from  the  experience  of  well 
managed  insurance  companies  or  societies. 

Personal  Accident  Insurance 

The  annual  loss  of  life  in  the  United  States  through  accidents 
of  all  kinds  exceeds  80,000.  The  mortality  from  casualties  and 
violence  is  about  the  same  as  the  estimated  total  mortality  from 
cancer  or  malignant  disease.  The  causes  of  such  accidents  or 
their  conditioning  circumstances  are  very  numerous  and  personal 
accident  insurance  has  been  developed  within  the  last  two  genera- 
tions as  an  indispensable  protection  of  the  individual  against  their 
pecuniary  consequences  or  the  necessary  indemnity  for  loss  of 
working  time.  The  system  has  been  developed  to  a  remarkable 
degree  of  scientific  perfection,  and  the  rating  practice  of  accident 
insurance  companies  now  conforms  quite  generally  to  the  results 
of  observed  experience.  Perhaps  no  other  branch  of  insurance 
has  done  more  to  bring  home  to  the  public  at  large  the  physical 
dangers  of  our  complex  modern  life  and  the  imperative  need  of 
a  thoroughly  well  considered  public  policy  of  personal  safety  and 
accident  prevention.  New  dangers  are  constantly  developing  as 
incidental  to  the  progress  of  society,  as  best  illustrated  by  the 
automobile  hazard  to  passengers  and  pedestrians  which  has  brought 
into  existence  a  quite  extensive  system  of  automobile  insurance. 
The  statistics  of  personal  accidents  and  their  apparent  causes  as 
published  from  time  to  time  by  accident  companies  have  done  much 
to  draw  attention  to  a  lamentable  phase  of  our  modern  life  in 
perhaps  the  most  convincing  and  conclusive  form.  It  remains  true, 
of  course,  that  "accidents  will  happen"  regardless  of  all  efforts 
at  prevention,  but  modern  society  is  irrevocably  committed  to  the 
conviction  that  the  frequency  of  all  accidents  must  be  reduced  to 


374       WORLD'S  INSURANCE  CONGRESS 

the  lowest  possible  minimum,  and  that  as  far  as  practicable  only 
such  casualties  shall  continue  to  occur  as  are  strictly  within  the 
non-preventable  class.  By  furnishing  adequate  pecuniary  support 
during  the  period  of  recovery,  the  personal  accident  companies 
have  also  rendered  an  incalculable  service  to  the  individual,  the 
Nation  and  the  State  in  the  conservation  of  the  physical  and  eco- 
nomic efficiency  of  its  citizens.  Finally  by  providing  for  the  ex- 
penses of  surgical  operations,  many  a  valuable  life  has  been  saved 
and  many  a  useful  career  has  been  prolonged  through  the  instru- 
mentality of  accident  insurance  as  devised  and  promoted  entirely 
through  private  enterprise  on  the  basis  of  voluntary  thrift. 

Employers'  Liability  and  Workmen's  Compensation 

Largely,  also,  through  the  initiative  of  personal  accident  insur- 
ance companies,  the  business  of  employers'  liability  insurance  has 
been  brought  to  a  high  degree  of  scientific  perfection.  Within  the 
last  few  years,  in  consequence  of  profound  and  radical  changes  in 
the  legal  status  of  the  employee  in  relation  to  the  employer,  the 
modern  system  of  Workmen's  Compensation  for  industrial  acci- 
dents has  come  into  existence.  The  two  forms  of  insurance  rest 
upon  quite  fundamentally  different  theoretical  conceptions.  Both 
are  extremely  useful  according  to  the  circumstances  of  the  case. 
Employers'  liability  insurance  has  done  much  if  not  most  to  in- 
augurate the  modern  and  highly  specialized  plant  inspectorial  ser- 
vice as  a  means  of  accident  prevention.  In  both  employers'  lia- 
bility and  workmen's  compensation,  the  premium  cost  is  funda- 
mentally determined  by  the  relative  frequence  of  industrial  acci- 
dent occurrence.  Both  forms  are,  therefore,  vitally  concerned  with 
the  prevention  of  accidents  as  a  first  means  of  reducing  the  cost 
of  such  insurance  to  employers.  Scant  justice  has  been  done  to 
companies  transacting  employers'  liability  insurance  in  the  public 
appreciation  of  their  invaluable  service  in  perfecting  methods  of 
industrial  plant  inspection  and  the  devising  of  effective  safeguards 
against  accident  occurrences  far  in  advance  of  efficient  means  of 
public  factory  inspection  and  the  corresponding  early  efforts  on 
the  part  of  industrial  accident  boards.  It  is  not  going  too  far  to 
say  that  probably  by  no  other  direct  means  has  so  much  of  life, 
health  and  strength  been  conserved  to  the  labor  element  of  the 
Nation  as  through  the  efficient  inspectorial  service  of  these  com- 
panies which  underlie  the  entire  modem  organization  of  indus- 
trial accident  boards,  by  public  inspection  and  rating  bureaus,  by 
safety  organizations  and  public  or  semi-public  museums  of  safety, 
all  of  which  now  largely  serve  the  needs  of  workmen's  compensa- 
tion for  industrial  accidents  and  industrial  diseases. 

Workmen's  compensation,  however,  is  a  decidedly  more  useful 
method  of  wage-earners'  protection  than  employers'  liability  in- 
surance, whicli  only  indirectly  or  incidentally  giuirded  the  em- 
ployee himself  against   extreme  hazards.     It  may  be  questioned 


WORLD'S  INSURANCE  CONGRESS  375 

whether  any  species  of  labor  legislation  has  been  of  greater  direct 
benefit  to  mankind  within  so  short  a  period  of  time  than  the  new 
order  of  things  under  which  the  pecuniary  consequences  of  indus- 
trial accidents  are  made  justly  a  direct  burden  upon  industry. 
It  requires  to  be  taken  into  consideration  that  the  number  of  in- 
dustrial accidents  in  the  United  States  is  annually  between  25,000 
and  30,000,  and  that  the  number  of  serious  injuries  involving 
more  or  less  prolonged  incapacity  for  work  is  probably  not  less 
than  700,000.  By  providing  the  necessary  economic  security  in  the 
event  of  accidents  inseparable  from  many  employments,  the  social 
condition  of  wage-earners  has  been  enormously  improved.  By 
making  provision  for  adequate  medical  attention,  the  physical  con- 
sequences of  industrial  accidents  have  been  reduced  in  seriousness 
and  the  injured  parties  are  now  as  a  rule  being  cared  for  intelli- 
gently and  properly  in  place  of  the  former  indifference  and  neg- 
lect. Infinitely  more  important,  however,  are  the  results  of  work- 
men's compensation  in  the  direction  of  direct  prevention  of  occu- 
pational accidents  and  occupational  diseases.  The  statistical  evi- 
dence already  available  is  quite  conclusive  that  in  consequence  of 
workmen's  compensation  legislation  the  actual  and  relative  fre- 
quency of  industrial  accidents  in  many  important  industries  has 
experienced  a  marked  reduction. 

It  would  be  utterly  impossible  on  this  occasion  to  enumerate 
even  briefly  the  tnily  astonishing  evidence  of  the  cooperative  effort 
throughout  the  country  developed  within  the  last  few  years  in  the 
direction  of  deliberate  and  successful  industrial  accident  preven- 
tion. The  most  convincing  illustration,  however,  of  what  is  being 
done  at  the  present  time  is  the  first  aid  and  rescue  work  of  the 
United  States  Bureau  of  Mines  which  has  been  brought  into  al- 
most perfect  correlation  to  the  corresponding  efforts  of  mining 
companies,  State  mining  bureaus,  and  State  industrial  accident 
boards.  The  rules  and  regulations  for  the  safe  conduct  of  indus- 
trial activity  which  have  been  perfected  and  made  compulsory 
through  Workmen's  Compensation  Commissions  are  indicative  of 
the  high  order  of  intelligence  which  lies  back  of  this  movement 
and  which  represents  the  combined  thought  and  serious  interest 
of  employers,  employees  and  super^dsing  government  officials. 
Among  other  agencies  contributing  towards  the  ultimate  reali- 
zation of  the  highest  ideals  of  safety  in  industry,  mention  re- 
quires to  be  made  of  the  admirable  pioneer  work  of  the  Ameri- 
can IMuseum  of  Safety  of  the  City  of  New  York  in  exhibiting  life 
saving  and  accident  preventing  devices  directly  applicable  to  the 
requirements  of  modern  industry  and  of  the  nation-wide  effort  of 
the  National  Council  of  Safety  of  Chicago,  which  has  concentrated 
most  of  its  effort  on  the  effective  safety  organization  of  employees. 
The  rating  practice  of  workmen's  compensation  bureaus,  private 
casualty  companies  transacting  workmen's  compensation  insur- 
ance and  State  industrial  accident  funds,  rests  fundamentally  upon 


376  WORLD'S  INSURANCE  CONGRESS 

the  more  or  less  precisely  determined  inherent  risks  of  modem 
industry,  subject  to  the  application  of  the  principle  of  schedule 
rating,  which,  as  well  said  by  the  Massachusetts  Insurance  Commis- 
sioner, "is  known  as  merit  rating,  each  individual  employer  being 
given  a  rate  that  corresponds  to  the  hazard  of  his  risk  according 
to  standards  which  have  been  set  up  by  trained  safety  engineers 
and  endorsed  as  the  best  yet  devised  for  apportioning  cost  of  in- 
surance on  the  basis  of  hazards." 

It  is  self-evident  that  by  this  method  of  insurance  the  utmost 
possible  encouragement  is  given  to  every  employer  to  prevent  the 
industrial  accidents  common  to  his  industry  by  the  adoption  of 
all  reasonable  safeguards  and  protective  devices  amplified  by  the 
adequate  safety  instruction  of  the  employees.  The  direct  pecu- 
niary service  which  accrues  to  the  employer  in  consequence  of 
premium  reduction  is  in  the  end,  of  course,  reflected  in  the  cost 
of  the  product.  A  vastly  gi'eater  benefit,  however,  is  rendered  to 
society  and  the  State  in  the  actual  preservation  of  the  most  valu- 
able of  human  lives,  that  is,  of  the  men  and  women  who  carry  on 
the  nation's  industries  and  who  perform  its  most  arduous  physical 
and  hazardous  toil.  In  its  final  analj'sis,  it  is  the  human  unit  that 
is  the  fundamental  basis  of  all  our  material  prosperity,  and  the 
conservation  of  physical  efificiency  and  physical  strength  is  there- 
fore rightfully  considered  to  be  the  first  duty  of  the  State. 

Fly- Wheel  Insurance 

Many  industrial  hazards  cannot,  however,  be  entirely  provided 
for  by  workmen's  compensation  insurance.  Many  risks  inherent 
in  the  operation  of  manufacturing  establishments  can  only  be  in- 
sured against  through  private  enterprise.  The  fly-wheel  as  an 
integral  part  of  modern  plant  machinery  is  a  concrete  illustra- 
tion of  this  important  aspect  of  public  liability  insurance  in  its 
relation  to  modern  business  life.  A  bursting  fly-wheel  may  com- 
pletely destroy  a  costly  power  plant  and  at  the  same  time  cause  a 
lamentable  loss  of  life.  The  pecuniary  consequence  of  fly-wheel 
accidents,  therefore,  requires  adequate  insurance  protection.  Fly- 
wheel insurance  has  of  necessity  been  developed  as  a  branch  of 
general  casualty  insurance,  but  the  fundamental  function  on  the 
part  of  the  insuring  company  is  rather  the  prevention  of  accidents 
than  the  payment  of  compensatory  damages.  It  has  been  pointed 
out  in  this  connection  by  a  large  company  on  the  basis  of  its 
experience  in  fly-wheel  insurance  that  ''wheels  that  are  sound, 
well  designed,  and  mounted  on  first-class  engines  are  likely  to  ex- 
plode at  any  moment  on  account  of  trivial  defects  in  the  governing 
mechanism  and  disruption  is  also  likely  to  be  caused  by  the  sud- 
den over-loading  of  machinery,  short  circuiting  of  the  electrical 
generator,  fractures,  faulty  construction,  and  other  defects  too 
numerous  to  mention." 

Thorough  and  expert  inspection  is,  therefore,  essential  in  the 


WORLD'S  INSURANCE  CONGRESS       377 

prevention  of  accidents  of  this  kind,  and  this,  in  fact,  is  the  prac- 
tical basis  of  all  fly-wheel  insurance.  The  importance  to  the  com- 
panies of  this  service  of  life  conservation  is  best  illustrated  by 
the  statement  that  "in  69  cases  according  to  actual  experience, 
94  people  were  killed  and  130  seriously  injured,  and  the  average 
property  loss  was  $13,500."  Every  fly-wheel  policy  provides  for 
inspection  at  regular  intervals,  not  only  of  the  fly-wheel  itself,  but 
of  the  engines  and  other  apparatus  upon  which  the  wheels  are 
mounted,  thus  giving  the  insured  the  benefit  of  expert  inspection 
as  a  first  consideration  in  the  very  important  effect  to  prevent 
losses  by  the  timely  correction  of  faults  discovered  by  this  means 
and  often  by  this  means  alone.  > 

Boiler  Insurance 

Of  much  the  same  order  of  importance  is  boiler  insurance  which 
is  carried  on  either  by  companies  exclusively  engaged  in  that  form 
of  business,  or  as  a  branch  of  private  casualty  insurance.  The  pri- 
mary object  of  boiler  insurance  is  not  the  payment  of  losses,  but 
the  prevention  of  explosions.  It  is  a  lamentable  fact  that  deaths 
due  to  boiler  explosions  in  the  United  States  are  considerably  in 
excess  of  the  corresponding  loss  of  life  in  European  countries. 
During  the  year  1912,  it  is  estimated  that  there  were  280  deaths 
due  to  boiler  explosions  in  the  United  States  against  only  30  in 
the  United  Kingdom  and  10  in  the  German  Empire. 

The  present  situation  would  be  decidedly  worse,  however,  were 
it  not  for  the  thoroughly  efficient  service  rendered  by  private  steam 
boiler  insurance,  which,  of  course,  is  additional  in  most  of  the 
States  to  a  more  or  less  efficient  State  boiler  inspection  service. 
It  is  not  going  too  far  to  maintain  that  the  present  practice  or 
technique  of  State  boiler  inspection  has  largely  been  evolved  out  of 
the  experience  of  private  steam  boiler  insurance  companies.  Here 
again  the  service  rendered  to  the  cause  of  life  conservation,  while 
not  precisely  determinable,  is  of  considerable  social  and  economic 
importance.  The  system  of  boiler  insurance  admirably  illustrates 
a  form  of  insurance  protection  aiming  primarily  at  prevention; 
and  of  the  premiums  annually  paid  on  account  of  boiler  insur- 
ance, only  a  relatively  small  proportion  is  paid  out  in  losses,  while 
the  major  portion  is  expended  in  connection  with  a  higtly  devel- 
oped system  of  expert  inspection. 

Elevator  Insurance 

It  would  be  as  difficult  to  conceive  of  modern  life  without  pas- 
senger elevator  transportation  as  of  the  transmission  of  intelli- 
gence without  electricity  or  of  transportation  without  steam.  It  is 
quite  probable  that  there  is  to-day  an  even  larger  amount  of  ver- 
tical passenger  traffic  by  means  of  elevators  than  there  is  of  hori- 
zontal traffic,  in  our  large  cities,  by  means  of  electric  railways, 


378       WORLD'S  INSURANCE  CONGRESS 

subways  and  motor  cars  combined.  Every  elevator  service  repre- 
sents intrinsically  a  serious  risk  to  life  and  property  adequately 
gfuarded  against  only  by  means  of  an  efficient  inspection  service. 
The  causes  of  elevator  accidents  are  quite  varied,  but  the  large 
majority  are  readily  subject  to  control.  There  is  a  public  lia- 
bility to  elevator  accidents  which  can  only  be  insured  against 
through  private  casualty  insurance  companies.  Both  the  opera- 
tor and  the  public,  however,  are  protected  against  accidents 
chiefly  through  the  inspectorial  service  provided  by  insurance  com- 
panies, and  accidents  on  elevators  covered  by  such  insurance  are 
of  relatively  rare  occurrence.  Every  elevator  insurance  policy  aims 
primarily  at  the  prevention  of  accidents,  and  the  payment  of  com- 
pensatory damages  is  of  decidedly  secondary  importance.  There 
are  no  trustworthy  statistics  regarding  the  total  annual  loss  of 
life  in  connection  with  the  operation  of  elevators  throughout  the 
United  States,  but  it  requires  to  be  considered  that  many  of  the 
deaths  officially  so  reported  are  only  incidental  to  elevator  opera- 
tion and  are  not  attributable  to  inherent  defects  in  the  service  it- 
self. Few  branches  of  insurance  illustrate  better  than  this  the 
extremely  valuable  aid  rendered  to  the  cause  of  life  conser^'ation 
by  means  of  a  service  which  rests  primarily  upon  the  concept  of 
prevention,  with  adequate  security,  of  course,  for  the  pa^Tnent  of 
compensatory  damages  in  the  event  of  unavoidable  and  strictly 
accidental  occurrences. 

Fidelity  and  Surety  Insurance 

These  branches  of  insurance  have  a  more  direct  relation  to  the 
cause  of  life  conservation  than  is  generally  understood.  It  is  but 
imperfectly  realized  that  a  large  amount  of  social  misconduct  is 
effectively  restrained  by  the  exacting  requirements  of  fidelity  and 
surety  insurance.  The  possibilities  of  breach  of  trust  are  very 
considerable  in  modern  business  and  with  a  constant  tendency 
towards  increasing  complexity  there  is  a  natural  development  to- 
wards refinement  in  methods  of  crime.  An  enormous  amount  of 
anxiety  and  worrj'-  is  prevented  by  the  sense  of  security  on  the 
part  of  business  management  that  employees  are  adequately 
bonded  against  dishonesty.  In  place  of  the  old  method  of  personal 
security  on  the  part  of  one  man  for  the  fidelity  of  another,  the 
modern  system  of  corporate  surety  replaces  an  extremely  unsat- 
isfactory state  of  affairs.  IMany  a  business  and  home  has  been 
financiall}''  ruined  because  of  the  dishonesty  of  an  employee  trusted 
as  a  matter  of  necessity  with  substantial  sums  of  money  without 
bond  security.  It  has  well  been  observed  in  this  connection  that 
"corporate  surety  is  scientific  and  it  aims  to  prevent  as  well  as 
to  reimburse.  It  searches  out  the  record  of  the  past  to  aid  in 
judgment  of  the  future.  It  aims  to  separate  the  honest  from  the 
dishonest,  and  to  keep  them  separate."  In  other  words,  corporate 
surety  promotes  character,   gives  its  unqualified   endorsement   to 


WORLD'S  INSURANCE  CONGRESS  379 

right  conduct,  with  the  practical  guarantee  of  certainty  of  punish- 
ment of  those  who  offend  by  breach  of  trust  against  the  individual, 
society  and  the  state.  Whatever  tends  to  promote  social  security 
also  tends  to  conserve  longevity,  health  and  happiness  individ- 
ually as  well  as  collectively.  Whatever  tends  to  reduce  crime  in 
no  small  measure  must  aid  in  the  cause  of  life  conservation  and 
the  advancement  of  social  well  being  generally. 

Burglary  Insurance 

The  guarantee  of  pecuniary  indemnity  against  injury  to  the  per- 
son and  property  by  felonious  assault  or  burglary  is  a  very  desira- 
ble form  of  protection  which  within  recent  years  has  gained  much 
in  popularity.  Regardless  of  a  highly  developed  public  police 
and  detective  service,  there  remains  a  vast  amount  of  non-pre- 
ventable and  unpunished  crime  best  illustrated  by  the  humiliating 
admission  that  there  are  annually  not  less  than  7,000  murders  in 
the  United  States.  Murder  is  much  more  frequent  in  this  coun- 
try than  others.  The  murder  death  rate  per  hundred  thousand, 
for  illustration,  for  the  year  1912  was  6.5  for  the  United  States, 
3.2  for  Italy,  and  2.1  for  Germany.  Burglary  insurance,  by  the 
installation  of  private  burglary  alarm  systems  and  by  the  develop- 
ment of  private  detectives  of  high  character,  has  done  much  to 
promote  health  and  longevity,  not  only  directly  but  indirectly 
as  well,  by  providing  conditions  favorable  to  a  feeling  of  personal 
security  and  peace  of  mind. 

Fire  Insurance 

The  magnitude  of  fire  insurance  approaches  the  enormous  vol- 
ume of  business  transacted  by  life  insurance  companies  and  socie- 
ties. The  combined  annual  income  of  American  fire  and  marine 
insurance  companies  is  probably  not  far  from  one-half  billion 
dollars.  The  annual  losses  paid  by  these  companies  now  approach 
two  hundred  million  dollars.  A  proportion  of  the  premium  in- 
come is  expended  in  connection  with  a  scientifically  perfected  plan 
of  risk  surveying  and  a  rating  practice  which  rests  upon  the  basic 
principle  of  equitable  adjustment  of  risk  exposure  to  insurance 
cost.  All  fire  waste  causes  not  only  a  useless  destruction  of  prop- 
erty, but  it  involves  in  many  cases  also  a  considerable  loss  of  life, 
health  and  opportunity  for  employment.  By  ascertaining  and  de- 
fining the  conflagration  hazard  in  large  cities,  the  National  Board 
of  Underwriters  has  rendered  a  substantial  service  to  the  cause 
of  property  and  life  protection.  In  the  furtherance  of  the  aims 
and  ideals  of  the  National  Fire  Prevention  Convention,  the  fire 
insurance  companies,  in  cooperation  with  State  fire  marshals  and 
other  agencies  making  for  fire  protection,  have  quite  measurably 
advanced  the  cause  of  fire  waste  reduction.  During  the  last 
thirty  years  it  is  estimated  that  over  five  billion  dollars  of  prop- 


380       WORLD'S  INSURANCE  CONGRESS 

erty  has  been  destroyed  by  fire  in  the  United  States,  and  in  many 
conspicuous  instances  the  incidental  loss  of  human  life  has  been 
quite  considerable.  By  emphasizing  and  defining  the  exposure 
hazard  and  by  insisting  upon  an  adequate  premium  proportionate 
to  the  risk,  the  fire  insurance  companies  have  made  it  directly  to 
the  advantage  of  the  insured  to  eliminate  needless  fire  hazards, 
particularly  in  the  direction  of  the  more  general  use  of  fire-resist- 
ing material  and  improved  methods  of  building  construction.  By 
insisting  upon  the  installation  of  high  pressure  fire-fighting  sys- 
tems, the  insurance  companies  have  indirectly  also  advanced  the 
cause  of  general  sanitation,  and  by  controlling  and  standardizing 
methods  of  electrical  installations  a  material  reduction  in  fire  haz- 
ards due  to  electrical  causes  has  been  brought  about  with  a  diminu- 
tion in  the  liability  to  fatal  electric  shock.  By  the  adoption  of 
stringent  rules  and  regulations  concerning  the  transportation  and 
storage  of  explosives,  the  risk  to  life  and  property  destruction  has 
been  materially  decreased.  By  aiming  persistently  and  intelli- 
gently at  the  deliberate  reduction  of  fire  losses,  an  enormous 
amount  of  property  has  been  conserved  to  future  generations. 

The  most  substantial  service  rendered  by  fire  insurance  compa- 
nies to  the  cause  of  life  conservation  consists,  however,  in  the 
gradual  development  of  a  highly  efficient  public  fire  department 
service  in  cooperation,  of  course,  with  municipal  governments,  and 
which  has  not  its  superior  anywhere  in  the  world.  Probably  no 
other  single  agency  has  been  so  effective  in  the  actual  saving  of 
human  life,  while  at  its  greatest  peril,  as  the  modern  paid  fire  de- 
partment. Human  rescue  work  at  fires  often  involves  extreme 
personal  hazard,  but  there  has  never  been  the  slightest  hesita- 
tion of  sacrifice  and  the  country  has  reason  to  be  proud  of  the  far 
from  small  group  of  heroic  fire  fighters  who  have  paid  for  their 
heroism  with  their  own  lives. 

It  is  also  not  going  too  far  to  say  that  the  science  of  fire  protec- 
tion has  been  largely  developed  through  the  agency  of  fire  insur- 
ance companies  in  cooperation,  of  course,  with  public  fire  depart- 
ments. The  work  which  has  been  done  in  perfecting  the  technique 
of  fire  hazards  through  the  laboratories  of  the  National  Board  of 
Fire  Underwriters  ranks  justly  as  one  of  the  scientific  achieve- 
ments of  the  age.  Last,  not  least,  the  results  of  the  statistical 
analysis  of  common  fire  causes  has  drawn  public  attention  to  the 
direction  in  which  preventive  efforts  are  most  likely  to  prove  suc- 
cessful. A  vast  amount  of  work,  of  course,  remains  to  be  done. 
In  course  of  time  the  extensive  reconstruction  of  business  and  pri- 
vate buildings  in  all  American  cities  will  be  necessary  on  account 
of  the  past  neglect  and  present  indifference  in  the  adoption  of 
proper  methods  of  building  construction.  The  responsibility  for 
this  menace  lies  not  with  the  fire  insurance  companies,  who  have 
left  nothing  undone  in  giving  encouragement  to  fire-proof  build- 
ing construction.     All  of  these  efforts  have  a  direct  bearing  upon 


WORLD'S  INSURANCE  CONGRESS  381 

the  problem  of  life  conservation  and  the  prevention  of  useless 
property  waste. 

Marine  Insurance 

The  origin  of  all  insurance  is  to  be  found  in  the  practice  of 
Marine  Insurance  which  dates  back  to  remote  antiquity.    Long  be- 
fore governmental  agencies  had  become  effective  in  the  charting 
of  the  coast,  in  the  placing  of  lighthouses  and  other  aids  to  navi- 
gation and  in  the  development  of  a  system  of  trustworthy  marine 
intelligence,  Lloyd's  of  London  and  later  other  marine  insurance 
societies  and  companies  exerted  their  influence  in  this  direction 
to  the  measurable  advantage  of  the  cause  of  life  and  property  con- 
servation.    One  of  the  most  curious  and  now  obsolete  branches  of 
insurance  was  the  issuance  of  policies  on  the  lives  of  mariners 
against  the  risk,  at  one  time  quite  serious,  of  capture  by  pirates, 
for  the  purpose  of  providing  a  sum  sufficient  for  their  ransom. 
One  of  the  earliest  forms  of  sickness  insurance  was  for  the  benefit 
of  seamen  in  connection  with  navigation,   and   it  is  of  interest 
to  note  that  the  United  States  Marine  Hospital  Service  (now  the 
United  States  Public  Health  Service)  originated  in  a  tax  on  ship- 
ping for  the  benefit  of  sick  and  disabled  sailors.     The  first  useful 
lifeboat  was  built  through  the  agency  of  Lloyd's,   and  even  to 
this  day  the  most  trustworthy  source  of  marine  intelligence  is  this 
truly  colossal  marine  insurance  office  of  London.    The  same  agency 
originated  and  developed  a  highly  trained  service  of  inspection  and 
ship  surveying,  aiming  at  the  safeguarding  of  shipping  on  the  basis 
of  standardized  rules  of  ship  construction.    By  insisting  upon  the 
seaworthiness  of  every  vessel  as  a  prerequisite  for  insurance,  a 
considerable  indirect  service  was  rendered  to  the  cause  of  life  con- 
servation.   By  urging  upon  the  governments  throughout  the  world 
the  necessity  for  the  highest  attainable  scientific  accuracy  and  com- 
pleteness in  coast  surveys  and  the  utmost  technical  perfection  of 
lighthouses,    fog   signals,    etc.,    the    marine    insurance    companies 
have  their  part  in  reducing  the  risk  of  life  at  sea.     Here,  also,  of 
course,  much  remains  to  be  done,  as  made  only  too  evident  by  re- 
cent lamentable  shipping  disasters,  which  emphasize  the  necessity 
of  a  broader  public  interest  in  the  efficiency  of  government  steam- 
boat inspection  and  the  more  intelligent  cooperation  of  private 
and  corporate  agencies  towards  this  end.    The  losses  of  the  General 
Slocum  and  the  Eastland  on  inland  waters  and  of  the  Titanic  and 
Empress  of  Ireland  on  the  high  seas,  are  conspicuous  instances  of 
the  inadequacy  of  present-day  methods  in  providing  the  highest 
degree  of  obtainable  safety  in  navigation.     It  may  be  questioned 
whether  the  marine  insurance  companies  of  to-day  realize  their  full 
responsibility  in  working  actively  for  improvements  in  conditions 
making  for  greater  safety  of  person  and  property  at  sea.    The  out- 
look for  a  material  broadening  of  the  sphere  of  marine  insurance 
in  this  direction  is,  however,  distinctly  encouraging. 


382  WORLD'S  INSURANCE  CONGRESS 


Conclusion 

The  magnitude  of  the  subject  under  discussion  precludes  ade- 
quate consideration  and  full  justice  to  all  the  interests  and  activi- 
ties concerned.  Enough  evidence,  however,  has  been  briefly  pre- 
sented amply  to  sustain  the  conclusion  that,  among  the  agencies 
serving  the  cause  of  humanity  in  the  direction  of  life  conservation, 
an  honorable  place  requires  to  be  assigned  to  insurance  in  all  its 
important  branches.  What  has  been  said  is  merely  an  indication 
of  the  main  direction  in  which  the  conservation  efforts  of  the 
insurance  companies  have  been  directly  or  indirectly  most  useful 
to  the  public  at  large.  The  fundamental  fact  must  never  be  lost 
sight  of,  that  the  first  and  all-important  function  of  insurance 
is  to  provide  for  the  payment  of  losses  and  that  these  humanita- 
rian services,  however  valuable,  are  and  ever  must  be  secondary 
to  the  economic  function  which  the  insurance  companies  by  law 
and  general  practice  are  intended  to  serve.  It  has  very  properly 
been  pointed  out  in  this  connection  in  a  recent  editorial  in  a  San 
Francisco  newspaper  (September  13,  1915)  that  "We  need  a  new 
form  of  democratic  organization  which  will  be  a  clearing  house  and 
a  distributing  point  for  all  useful  knowledge  and  skill.  Knowl- 
edge about  typhoid,  about  bad  housing,  about  impure  food,  about 
recreation,  ought  to  be  combined  with  knowledge  about  industry 
and  income,  so  that  every  citizen  will  be  helped  to  live  a  life  that 
is  wholesome  in  all  respects." 

There  is  probably  no  other  business  agency  which  is  rendering 
so  large  a  share  of  this  useful  public  service,  and  practically  with- 
out additional  cost,  as  insurance.  In  an  age  which  is  becoming 
largely  economic  and  in  which  the  conservation  of  resources  and 
the  prevention  and  utilization  of  waste  are  a  prerequisite  for 
the  attainment  of  the  largest  share  of  human  happiness,  the  re- 
quirements for  such  subsidiary  service  as  is  voluntarily  rendered 
by  insurance  will  become  more  general  in  the  furtherance  of  the 
broader  interests  of  the  people  and  the  State.  Insurance  has  de- 
veloped gradually  into  an  institution  of  marvelous  and  universal 
utility  and  it  is  largely  because  of  its  preeminence  as  a  universal 
provident  institution  that  the  insurance  companies  are  rightfully 
entitled  and  properly  deserving  of  the  most  liberal  and  consider- 
ate attitude  on  the  part  of  the  State.  Freedom  from  burdensome 
statutory  requirements  and  excessive  taxation  must  materially  aid 
in  the  direction  of  enhancing  the  future  usefulness  of  these  institu- 
tions. As  has  been  shown  by  the  brief  outline  of  tlie  health  and 
life  con.serving  functions  now  performed  by  these  companies,  they 
have  done  much  in  the  past,  but  they  are  destined  to  render  an 
even  greater  service  in  the  years  to  come.  In  proportion  as  the 
highest  ideal  of  perfect  cooperation  is  realized  between  the  insur- 
ance companies  and  public  authorities  and  by  all  corporate  and 
private  health-promoting  agencies,  the  place  of  insurance  in  be- 


WORLD'S  INSURANCE  CONGRESS  383 

half  of  the  cause  of  humanity  will  be  advanced.  As  a  working 
program  for  the  immediate  future  and  as  a  concrete  suggestion 
towards  the  realization  of  the  higher  ideals  and  aims  of  insurance 
institutions,  it  is  here  suggested  to  the  companies  and  the  public 
that: 

First,  In  profound  appreciation  of  the  truly  enormous  possi- 
bilities of  increasing  human  happiness  and  individual  and  col- 
lective efficiency  by  a  further  substantial  reduction  in  the  death 
rate  and  the  successful  elimination  of  a  vast  amount  of  prevent- 
able disease, — the  social  and  economic  burden  of  which  is  only 
approximately  indicated  by  the  statement  that,  regardless  of  the 
most  commendable  efforts  made  on  the  part  of  public  health  de- 
partments and  other  health-promoting  agencies,  the  annual  loss 
of  life  of  children  under  five  is  nearly  350,000:  from  the  acute 
diseases  of  infancy,  chiefly  diphtheria,  measles,  whooping  cough 
and  scarlet  fever,  about  50,000;  from  all  forms  of  tuberculosis, 
about  150,000;  and  from  typhoid  fever  about  20,000 — the  sugges- 
tion is  here  most  urgently  made  that  there  be  a  more  deliberate 
effort  to  bring  about  a  more  perfect  plan  of  cooperation  between 
public  health  authorities  and  associated  private  activities  and  the 
more  or  less  corresponding  work  of  life  insurance  companies  and 
societies. 

Second,  In  consideration  of  the  lamentable  fact  that  there  is 
an  annual  loss  of  not  less  than  80,000  lives  in  the  United  States 
due  to  accidents  or  casualties  of  all  kinds,  and  that  of  this  loss,  at 
least  25,000  deaths  occur  in  American  industry,  and  that  in  addi- 
tion thereto  there  are  probably  not  less  than  700,000  serious  but 
not  fatal  accidents  causing  temporary  or  permanent,  partial  or 
total  incapaeit}^  for  work,  it  is  strongly  urged  upon  all  life,  health 
and  accident  insurance  companies  and  societies  that  they  cooperate 
more  effectively  than  heretofore  in  the  nation-wide  safety  first 
movement  best  illustrated  in  the  remarkably  successful  work  of  the 
American  Museum  of  Safety,  the  National  Council  of  Safety,  and 
many  kindred  organizations. 

Third,  The  world  justly  regards  the  achievement  at  Panama  as 
the  crowning  glory  of  medical  and  sanitary  science.  In  contrast 
to  a  death  rate  of  employees  during  the  American  period  of  con- 
struction of  only  15  per  thousand,  the  corresponding  loss  of  life 
during  the  French  period  of  construction  was  61.  What  has  been 
done  by  American  sanitary  engineers  on  the  Isthmus  of  Panama 
in  the  control  of  tropical  diseases  challenges  the  admiration  of 
mankind.  Tropical  medicine  and  sanitation  are,  however,  as  yet 
very  far  from  having  reached  their  highest  attainable  degree  of 
perfection,  and  much  remains  to  be  done  to  bring  about  the  sani- 
tary control  of  the  tropics,  so  essential  in  the  furtherance  of  com- 
merce and  the  cause  of  human  well-being  throughout  a  large  por- 
tion of  the  world.  Life  insurance  companies  can  do  much  in  this 
direction  by  encouraging  the  work  of  schools  of  tropical  medicine 


384       WORLD'S  INSURANCE  CONGRESS 

and  the  scientific  study  of  the  mortality  problems  of  tropical  coun- 
tries, particularly  of  the  Western  Hemisphere. 

Fourth,  Life  insurance  medicine  has  for  many  years  been  an  im- 
portant branch  of  medical  science  and  of  value  not  only  to  the 
companies,  but  also  to  the  public  at  large  in  the  furtherance  of 
the  plan  of  life  extension.  An  enormous  amount  of  real  work 
remains  to  be  done  if  present-day  ideals  of  better  health  and  more 
effective  physical  efficiency  are  to  be  realized.  It  is,  therefore, 
urged  upon  the  companies  and  the  medical  profession  that  there 
be  brought  about  a  more  perfect  bond  of  union  to  the  end  that 
the  qualified  teaching  of  the  principles  of  insurance  medicine,  in- 
cluding occupational  hygiene,  be  made  universal  in  the  curriculum 
of  all  our  leading  medical  institutions. 

Fifth,  The  ultimate  realization  of  the  highest  aims  and  ideals  of 
the  present-day  health  conservation  movement  must  depend  largely 
upon  the  active  cooperation  of  the  general  public  and  the  public 
health  authorities  as  well  as  the  more  or  less  related  health-pro- 
moting agencies.  Such  public  cooperation  as  is  required  must  rest 
upon  a  sound  basis  of  general  instruction  regarding  the  elemen- 
tary facts  of  disease  causation  and  disease  prevention,  including 
a  thorough  understanding  and  appreciation  of  the  methods  of  first 
aid  to  the  injured,  of  qualified  nursing  and  the  care  of  the  sick, 
of  precautionary  measures  against  occupational  disease,  of  the 
control  of  non-preventable  diseases,  such  as  cancer,  and  possibly 
leprosy,  and  last,  not  least,  conformity  in  personal  conduct  to  ra- 
tional rules  of  right  living  as  essential  to  the  attainment  of  the 
healthiest,  the  most  efificient,  and  the  longest  life.  In  perhaps  no 
other  direction  can  the  life  insurance  companies,  and  particularly 
those  transacting  industrial  business,  render  more  effective  social 
service  than  in  the  cause  of  the  health  education  of  the  public  as 
best  illustrated  by  the  instructive  and  convincing  health  literature 
widely  distributed  among  the  general  public  by  these  companies 
and  by  the  impressive  popular  and  scientific  exhibits  made  on  the 
occasion  of  this,  the  greatest  of  world 's  Expositions. 

Sixth,  Regardless  of  the  many  scientific  contributions  which 
have  been  made  by  life  insurance  companies  towards  a  better  un- 
der.standing  of  the  problems  of  mortality,  as  best  shown  by  the  re- 
markable results  of  the  medico-actuarial  investigation  of  American 
life  insurance  companies  on  the  one  hand  and  the  special  statis- 
tical research  work  of  industrial  insurance  companies  on  the  other, 
there  remains  a  vast  unrealized  opportunity  to  coordinate  efforts 
of  this  kind  to  corresponding  investigations  made  by  the  Federal, 
the  State  and  municipal  public  health  authorities  as  well  as  by 
private  and  corporate  health-promoting  activities.  It  is  sincerely 
to  be  hoped  that  more  will  be  achieved  in  the  future  in  this  direc- 
tion than  has  been  found  possible  in  the  past,  and  it  is  particularly 
urged  upon  the  companies  that  they  give  more  publicity  to  the 
results  of  their  own  mortality  experience,  with  a  due  regard  to 


WORLD'S  INSURANCE  CONGRESS  385 

the  causes  of  death  and  their  relation  to  age,  sex,  race,  occupation 
and  locality,  in  more  or  less  conformity  to  the  Division  of  Vital 
Statistics  of  the  United  States  census  and  the  international  classi- 
fication of  the  causes  of  deaths. 

Seventh,  By  common  consent,  a  large  amount  of  our  annual 
fire  loss,  which  exceeds  two  hundred  million  dollars,  would  be  easily 
preventable  if  there  were  a  more  hearty  cooperation  on  the  part 
of  the  general  public.  Effective  education  in  this  direction  must 
prove  of  the  greatest  possible  value  not  only  to  the  companies  but 
to  the  Nation  and  the  people  at  large.  In  fact,  the  cause  of  fire 
prevention  is  a  National  problem  of  the  first  order  of  importance. 
Fires  are  largely  the  result  of  ignorance,  carelessness  and  indif- 
ference. The  movement  which  has  been  inaugurated  during  recent 
years  to  introduce  a  brief  course  on  fire  prevention  into  the  public 
schools  is  in  every  way  deserving  of  encouragement.  Such  a  course 
should  be  combined  with  thoroughly  practical  fire  drills;  but  it 
may  possibly  be  found  more  expedient  to  combine  teaching  efforts 
at  fire  prevention  with  corresponding  efforts  at  accident  preven- 
tion, in  appreciation  of  the  fact  that  a  large  number  of  young  lives 
are  annually  sacrificed  because  of  ignorance  in  matters  which 
should  be  the  common  knowledge  of  all.  Present  methods  of  such 
education  have  hardly  passed  beyond  the  initial  state.  It  is  easy 
to  argue  that  the  child  is  already  overburdened  with  subjects  re- 
quired by  the  school  curriculum,  but  in  its  final  analysis  the  con- 
servation of  life  and  health  is  of  infinitely  more  importance  than 
the  acquisition  of  mere  knowledge,  serving  often  no  practical  pur- 
pose whatever.  It  may  be  laid  down  as  a  first  principle  of  all 
education  that  the  child  should  understand  the  elementary  func- 
tions of  its  own  body  and  should  be  instructed  to  safeguard  itself 
against  the  more  or  less  avoidable  diseases  and  casualties  of  life. 
It  is  strongly  urged,  therefore,  upon  the  fire,  the  accident  and  the 
life  insurance  companies  and  allied  insurance  interests  that  they 
cooperate  in  the  most  effective  manner  possible  in  behalf  of  an 
effort  to  introduce  the  proper  teaching  of  the  elementary  facts 
of  life  and  health  conservation  into  the  schools,  and  through  this 
means  into  the  home,  so  that  the  largest  amount  of  attainable  good 
may  be  realized  at  lowest  cost. 

This  program  of  constructive  cooperation  suggests  no  new 
methods  or  means,  but  merely  a  perfection  and  enlargement  of 
lines  of  activity  in  conformity  to  past  efforts  and  experience,  nor 
is  anjrthing  suggested  which  would  place  upon  insurance  interests 
material  additional  financial  burdens  or  duties  alien  to  their  or- 
ganic function  of  providing  for  the  pecuniary  consequences  of  the 
contingencies  which  arise  out  of  the  inherent  uncertainties  of  life. 
In  the  evolution  of  social  institutions,  the  highest  degree  of  gen- 
eral usefulness  has  often  been  incidental  rather  than  general,  and 
the  thought  is  here  advanced  that  it  may  well  be  questioned  whether 
any  field  of  human  activity  offers  to-day  greater  practical  possi- 


386       WORLD'S  INSURANCE  CONGRESS 

bilities  in  behalf  of  the  cause  of  humanity  than  insurance  in  its 
relation  to  the  conservation  of  human  life. 


HUMAN  LIFE  AS  A  NATIONAL  ASSET 

By  Dr.  C.  C.  Pierce 
Senior  Surgeon,  United  States  Public  Health  Service 

In  this  age  of  commercialism  it  is  fitting  and  proper  that  every- 
thing, including  human  life,  be  reduced  to  a  money  equivalent. 

There  are  difficulties  in  arriving  at  the  assessed  value  of  hu- 
man life,  not  encountered  in  making  a  valuation  of  material  as- 
sets. Fluctuations  in  value  of  material  assets  can  be  quite  accu- 
rately determined  and  the  conditions  which  cause  depreciation  are 
definitely  known. 

With  human  lives,  however,  there  are  many  personal  differences 
and  variations  of  environment  that  may  affect  the  estimated  depre- 
ciation, so  that  only  approximate  estimates  of  the  ultimate  money 
value  of  these  lives  can  be  determined.  No  consideration  will  be 
given  the  ethical  or  sentimental  value  of  human  beings  in  this 
discussion. 

While  these  statements  apply  to  individual  lives,  any  one  of 
which  is  very  uncertain,  if  all  lives  are  considered  together  and 
an  average  made,  the  life  expectancy  so  ascertained  is  very  defi- 
nite, and  an  approximate  money  value  can  be  placed  upon  human 
life. 

Money  Value  op  Human  Lives 

The  Bureau  of  the  Census  estimates  the  population  of  the  Conti- 
nental United  States,  July  1,  1915,  to  be  100,400,000  persons.  The 
value  of  these  lives,  reduced  to  dollars  and  cents,  gives  a  sum  which 
is  meaningless  on  account  of  its  greatness.  Professor  Irving  Fisher, 
in  arriving  at  the  value  of  human  life,  has  accepted  the  estimate 
of  Farr,  of  England,  modified  somewhat  to  conform  to  the  in- 
creased earning  power  of  Americans.  The  value  of  human  life, 
of  course,  varies  from  a  few  dollars  in  infancy  to  a  large  sum 
in  active  middle  life,  gradually  decreasing  to  a  negligible  quan- 
tity in  old  age.  The  average  value  of  tliese  extremes  between 
infancy  and  old  age  is  approximately  $2,900  per  human  life.  Using 
this  figure  ($2,900)  the  value  of  human  lives  in  the  continental 
United  States  might  be  stated  financially  as  $291,160,000,000. 

The  Bureau  of  the  Census  estimates  that  the  aggregate  physical 
wealth  of  the  United  States  in  1912  was  $187,739,000,000.  This 
gives  a  difference  in  favor  of  human  life  as  a  national  asset  of 
$103,421,000,000.  However,  the  difference  is  very  much  greater 
than  is  indicated  by  even  this  stupendous  sum. 

Human  life  is  what  gives  value  to  all  other  assets.    All  material 


WORLD'S  INSURANCE  CONGRESS  387 

assets  are  useful  only  for  protecting,  prolonging  and  adding  to  the 
comfort  of  human  life  and  providing  for  the  perpetuation  of  the 
species.  Merely  to  live  is  not  sufficient;  to  be  a  valuable  asset 
human  life  must  be  efficient;  the  greatest  requisite  for  efficiency 
is  health. 

Earning  Power  op  American  Workers 

Emerson  has  said  that  "Health  is  the  first  wealth."  It  is 
partly  on  account  of  impaired  physical  efficiency  that  the  aver- 
age earning  capacity  of  aii  individual  is  small. 

The  average  wage  of  American  workers  during  the  age  period 
from  17  to  60  years  amounts  to  about  $700  per  annum.  This 
figure  would  apply  if  all  during  that  age  were  at  work;  but  it 
is  a  fact  that  only  about  three-fourths  are  at  work  from  one  cause 
or  another,  such  as  living  on  investment  income,  etc.,  so  that  the 
average  earning  must  be  at  once  reduced  to  about  $525  per  year. 
This  figure  includes  all  salaries,  from  the  cheapest  day  laborer 
to  that  of  railway  presidents.  Warren,  quoting  from  the  figures 
of  the  Immigration  Commission,  says  that  the  average  incomes  of 
the  heads  of  households  is  less  than  $500  in  15,726  families  inves- 
tigated among  the  workers  in  twenty  of  the  leading  industries  of 
the  United  States.  These  figures  are  referred  to  in  connection 
with  human  life  considered  as  a  national  asset  to  remind  us  that 
prevention  of  physical  impairment  and  disease  is  an  economic 
problem  quite  as  much  as  a  sanitary  one. 

No  family  of  5.6  persons  (found  to  be  an  average  family  among 
workers)  can  secure  the  necessary  food,  clothing  and  shelter  to  be 
able  to  resist  disease  on  a  total  financial  budget  of  $500  a  year, 
or  even  a  much  greater  sum. 

Sickness  Largely  Preventable 

In  considering  the  value  of  human  lives,  there  is  both  length 
and  breadth  of  life  to  be  considered.  The  length  of  life  is  de- 
pendent upon  the  death  rate,  and  this  decreases  through  improve- 
ment in  sanitary  conditions,  increased  knowledge  of  how  diseases 
are  acquired,  and  better  economic  conditions,  such  as  higher  wages, 
which  make  possible  a  better  standard  of  living,  including  im- 
proved housing,  more  food,  proper  clothing  and  an  opportunity 
of  educating  the  next  generation. 

The  result  of  the  lowered  death  rate  is  not  only  to  extend  the 
average  length  of  life,  but  to  cause  the  increase  in  the  number  of 
individuals  included  in  the  workin  gage  period  (from  17  to  60) 
and  thus  increasing  the  potential  value  of  the  earning  capacity  of 
the  workers,  adding  to  the  value  of  life  as  an  asset. 

Sickness  is  not  always  of  a  nature  to  be  reportable,  and  it  is 
believed  that  "well"  people  lose  from  three  to  five  days  each 
year  from  minor  ailments,  such  as  colds,  headaches,  indigestion, 
etc.,  practically  all  of  which  could  be  avoided. 


388       WORLD'S  INSURANCE  CONGRESS 

It  has  been  estimated  that  nine-tenths  of  all  human  ailments 
could  be  eliminated  through  preventive  measures  and  proper  en- 
vironment.    Dr.  Gulick  says: 

"With  the  removal  of  nine-tenths  of  our  disabilities  and  the  con- 
servation and  future  development  of  our  natural  powers,  the  aver- 
age person  can  increase  his  efficiency  100  per  cent. ;  thus  he  can 
be  twice  as  effective.  This  does  not  refer  to  accomplishing  twice 
as  much  w^ork,  of  course,  but  by  making  less  mistakes  and  working 
at  a  higher  rate  of  speed  when  one  does  work." 

Educational  campaigns  are  necessary  to  eliminate  the  greater 
part  of  sickness  and  to  prolong  life. 

One  necessary  factor  for  determining  the  health  status  of  a  com- 
munity is  a  complete  record  of  births,  diseases  ajid  deaths. 

A  statement  made  a  few  years  ago  by  Cressy  L.  Wilbur  is  ap- 
plicable to-day: 

"Sound  vital  statistics  are  the  indispensable  basis  of  modern 
sanitation.  A  nation  that  does  not  consider  necessary  or  that 
is  not  able  to  provide  adequate  means  of  registering  the  births  of 
its  own  children,  or  officially  recording  the  deaths  of  its  own  citi- 
zens, can  hardly  be  supposed  to  attach  sufficient  value  to  human 
life  to  enable  sanitary  measures  for  its  conservation  to  be  ade- 
quately carried  out." 

Only  65.1  per  cent  of  the  population  of  the  continental  United 
States  live  in  States  that  have  adequate  laws  regulating  the  re- 
ports of  births,  diseases  and  deaths.  The  States  that  have  laws 
properly  enforced  are  known  as  the  "Registration  Area."  The 
death  rate  in  the  Registration  Area  of  the  United  States  in  1880 
was  19.8.  This  rate  during  1913  was  14.1,  which  means  a  saving 
of  5.7  lives  per  thousand  during  the  latter  year  over  1880. 

If  the  1880  rate  had  remained  in  1913,  there  would  have  been 
1,188,114  deaths  in  the  continental  United  States,  instead  of  938,- 
049,  so  that  250,065  lives  were  saved  during  1913.  Valued  at 
$2,900  each,  the  money  value  of  these  lives  would  be  $725,188,500, 
a  sum  well  worth  saving.  The  amount  expended  for  sanitation 
and  all  betterment  of  conditions  affecting  health  during  1913  can- 
not be  accurately  determined ;  but  it  is  safe  to  say  that  it  was 
greath^  less  than  the  return  upon  the  investment. 

Average  Length  of  Life 

This  lovvcred  death  rate  also  increased  the  age  of  death,  until 
the  average  lifetime  in  1913  has  increased  from  32.2  years  in 
1900  to  39.8  years  in  1913,  an  increase  of  4.6  years  for  each  life. 

The  average  age  at  death  is  found  by  dividing  the  total  number 
of  years  lived  by  those  who  died  by  the  number  of  decedents, 
and  differs  greatly  from  the  expectation  of  life  given  in  the  life 
tables. 


WORLD'S  INSURANCE  CONGRESS  389 

Hoffman  reminds  us  that  "This  decline  in  death  rate  has  been 
largely  at  the  younger  ages,  and  not  during  the  period  of  life 
which  has  the  greatest  economic  value,"  and  yet,  during  1913,  in 
the  Registration  Area,  there  were  19,938  deaths  from  measles,  sear- 
let  fever  and  whooping-cough,  diseases  of  childhood,  most  of  which 
could  have  been  avoided. 

The  death  rate  in  the  United  States  is  now  lower  than  in  any 
other  part  of  the  world,  with  the  exception  of  New  Zealand,  Aus- 
tralia, England  and  Wales.  Notwithstanding  this  low  rate,  the 
total  number  of  deaths  in  the  continental  United  States  in  1913 
amounted  to  938,049. 


Deaths  from  Three  Preventable  Diseases 

Let  us  examine  the  records  and  see  what  diseases  caused  many 
of  these  938,049  deaths  in  the  United  States  during  1913. 

There  were  15,786  deaths  from  typhoid  fever  alone  during  the 
j^ear  1913.  Typhoid  is  well  known  to  be  a  disease  that  is  absolutely 
preventable — as  much  so  as  is  smallpox.  Improved  sanitary  con- 
ditions have  lowered  the  typhoid  death  rate  in  the  Registration 
Area  from  35.9  per  thousand  in  1900  to  17.9  per  thousand  in  1913, 
a  reduction  of  50  per  cent. 

One  great  factor  in  reducing  typhoid  fever  is  improved  public 
water  supplies.  This  not  only  saves  lives  by  preventing  typhoid, 
but  for  each  life  saved  from  this  disease  two  or  three  lives  are 
saved  through  the  prevention  of  other  diseases.  Anti-typhoid  vac- 
cination is  gaining  favor  to  such  an  extent  that  approximately 
300,000  persons  in  the  United  States  will  receive  this  preventive 
treatment  during  1915.  Typhoid  fever  should  become  an  extinct 
disease  in  all  civilized  and  educated  communities,  and  when  this 
disease  no  longer  prevails  the  annual  saving  from  this  one  disease 
will  amount  to  about  200  million  dollars  per  year  in  the  United 
States. 

Another  preventable  disease  which  causes  enormous  losses  of 
efficiency  each  year  is  malaria.  The  number  of  eases  of  malaria 
in  the  United  States  during  1913  has  been  estimated  at  three 
million.  If  each  case  lost  one  month's  wages,  the  loss  in  income 
amounted  to  142  million  dollars.  The  number  of  deaths  reported 
from  malaria  during  1913  is  given  as  2,924,  these  lives  having  a 
value  of  eight  and  a  half  million  dollars.  Many  deaths  reported 
as  from  other  causes  would  not  have  occurred  had  the  patient  not 
been  weakened  from  chronic  malaria,  so  that  the  number  of  deaths 
reported  from  this  disease  does  not  give  a  fair  idea  of  its  im- 
portance. 

During  1913  in  the  United  States  there  were  143,970  deaths 
from  tuberculosis.  The  manner  in  which  this  disease  is  spread 
is  well  known  and  much  has  been  accomplished  towards  its  re- 
duction.    The  death  rate  from  tuberculosis  during  1900  in  the 


390       WORLD'S  INSURANCE  CONGRESS 

Registration  Area  was  201  per  100,000,  while  in  1913  it  had  been 
reduced  to  147.1  per  100,000,  a  saving  of  54.8  lives  for  every 
100,000  inhabitants  of  the  United  States.  This  rate  of  reduction 
cannot  be  continued,  as  tuberculosis  is  a  problem  for  the  economist, 
as  well  as  for  the  sanitarian.  Its  prevention  and  cure  depend 
upon  proper  food,  housing  and  environment.  Plenty  of  nourish- 
ing food  cannot  be  secured  without  money.  That  the  economic 
condition  greatly  affects  death  rates  is  shown  in  the  report  of  the 
United  States  Commission  on  Industrial  Relations.  They  found 
that  the  death  rate  among  babies  was  four  times  greater  in  fami- 
lies where  the  income  was  $10  a  week  than  it  was  in  families  with 
an  income  of  $25  a  week. 

These  figures  are  given. to  show  that  dollars,  properly  spent, 
save  lives  and  are  needed  to  conserve  our  greatest  national  asset — 
human  life. 

Inefficiency 

One  reason  why  human  life  has  such  a  low  average  valuation 
is  on  account  of  the  inefficiency  resulting,  not  only,  from  dis- 
eases, but  from  other  impaired  physical  and  mental  conditions, 
and  lack  of  education.  In  the  United  States  there  are  13,345,545 
foreign-born  white  persons,  and  12,916,311  native  Americans  both 
parents  of  whom  were  foreign  born.  Many  of  these  people  are 
not  only  uneducated,  but  have  a  very  limited  knowledge  of  the 
English  language,  which  impairs  their  earning  capacity. 

While  conditions  are  greatly  better  among  the  native-born 
American  children  than  in  most  other  countries,  there  is  a  ten- 
dency in  the  laboring  class  to  take  them  out  of  school  at  an  early 
age  to  become  bread  winners.  Many  times  this  seems  almost  ab- 
solutely necessary  on  account  of  the  high  cost  of  living,  and  the 
low  wages  paid  unskilled  labor.  Lack  of  early  education,  however, 
may  be  due  to  sickness  of  the  child  either  from  preventable  dis- 
eases such  as  scarlet  fever  sequeL^,  hookworm  and  malaria,  or  from 
abnormalities  such  as  impaired  eyesight,  enlarged  tonsils,  adenoids, 
and  malnutrition.  Twenty  per  cent  of  the  children  studied  by 
the  Commission  on  Industrial  Relations  were  found  to  be  under- 
nourished. 

The  United  States  Bureau  of  Education  has  prepared  a  chart 
which  shows  in  an  impressive  manner  the  value  of  education  as  it 
affects  the  earning  power.  The  wages  of  two  groups  of  Brooklyn 
citizens  are  compared  on  a  graphic  chart,  which  shows  that  at 
25  years  of  age  the  better  educated  boys,  those  leaving  high  school 
at  18  years,  were  receiving  $900  per  year  more  salaiy  than  the 
boys  who  left  school  at  the  age  of  14.  They  were  not  only  re- 
ceiving more  annual  salarv,  but  in  seven  years  had  earned  $2,500 
more  than  the  boys  who  left  school  at  the  earlier  age. 

Another  chart  .shows  that  the  average  earnings  of  uneducated 
laborers  amounts  to  $500  per  year  for  forty  years,  this  class,  there- 
fore, earning  $20,000  during  their  working  period. 


WORLD'S  INSURANCE  CONGRESS  391 

Statistics  show  that  high  school  graduates  earn  an  average  of 
$1,000  per  year  for  forty  years,  giving  a  total  of  $40,000  during 
forty  years.  The  high  school  education  requires  twelve  years  of 
schooling  of  180  days  each,  or  a  total  of  2,160  days  in  school. 
If  2,160  days  in  school  add  twenty  thousand  dollars  to  the  income 
for  life,  then  each  day  spent  in  school  is  worth  $9.02,  Therefore 
the  child  that  stays  out  of  school  to  earn  less  than  .$9.00  per  day 
is  losing  money,  not  making  money. 

After  having  the  value  of  education  impressed  in  this  manner  it 
should  cause  serious  consideration  to  learn  that  the  report  of  the 
Commission  on  Industrial  Relations  shows  that  only  10  per  cent  of 
the  school  children  investigated  by  them  reached  the  high  school. 

Alcoholism  and  Crime 

Another  important  cause  of  inefficiency,  sickness  and  death  is 
alcoholism.  During  1913  there  were  3,744  deaths  in  the  Registra- 
tion Area  from  this  cause.  The  use  of  alcohol  has  been  shown  by 
the  Bureau  of  Labor  Statistics  of  Massachusetts  to  be  responsible 
for  84  per  cent  of  all  crime  committed  in  that  State.  Delinquents 
of  all  sorts  cause  the  withdrawal  from  useful  society  of  a  tremen- 
dous number  of  persons.  The  census  shows  that  on  January  1, 
1910,  there  were  146,492  men,  women  and  children  confined  in 
penitentiaries,  jails,  work-houses  and  reform  schools  in  the  United 
States. 

Blindness 

The  1910  census  gives  the  number  of  blind  in  the  United  States 
as  34,443  males,  25  per  cent  of  whom  were  gainfully  employed,  and 
24,829  females,  5  per  cent  of  whom  were  so  employed.  One-third 
of  these  persons  lost  their  eyesight  through  preventable  cause. 
Deducting  those  that  were  gainfully  employed  from  the  total  num- 
ber of  blind,  we  find  that  25,833  men  and  23,808  women  were  par- 
tially or  totally  dependent  through  this  one  physical  impairment, 
a  large  part  of  which  was  avoidable. 

Human  Liabilities 

There  are  many  conditions  which  cause  human  beings  to  be- 
come absolutely  useless  for  long  periods  before  they  finally  come 
to  the  end  and  are  no  longer  a  factor  in  human  valuation.  One 
such  class  of  liabilities  are  the  insane  and  feeble-minded. 

In  January,  1910,  there  were  187,454  persons  confined  in  insti- 
tutions for  the  insane  in  the  United  States.  This  number  exceeds 
all  of  the  officers  and  enlisted  men  in  the  Army,  Navy  and  Marine 
Corps;  and  it  costs  the  people  of  the  United  States  $32,804,450 
per  year  to  maintain  this  dependent  class. 

Not  only  did  it  cost  this  amount  to  maintain  them,  but  the  eco- 
nomic loss  resulting  from  the  withdrawal  of  this  large  number  of 


392  WORLD'S  INSURANCE  CONGRESS 

people  from  the  earning  class  amounted  to  more  than  one  hundred 
and  thirty  million  dollars. 

Not  only  is  the  care  of  the  insane  a  great  economic  burden,  but 
the  burden  is  growing  greater  on  account  of  proper  and  humane 
care  of  defectives,  as  the  average  length  of  life  of  insane  and  feeble- 
minded persons  showed  an  increase  of  eight  years  in  one  state 
where  accurate  records  are  kept. 

Welfare  Agencies 

There  are  at  present  a  large  number  of  organizations  engaged 
in  preventing  disease,  saving  and  prolonging  human  life  and  pro- 
moting health  and  happiness.  The  Federal  Government,  through 
the  United  States  Public  Health  Service,  is  accomplishing  work 
of  inestimable  value.  This  Federal  Bureau  of  Health  has  charge 
of  the  Quarantine  Service  of  the  United  States  and  its  possessions. 
During  the  fiscal  year  1914,  8,788  vessels  were  inspected  at  the  49 
domestic  quarantine  stations  and  5,582  vessels  at  the  34  foreign 
and  insular  stations  of  the  Service.  All  immigrants  entering  our 
country  are  examined  by  Service  officers,  in  order  to  exclude  dis- 
eased persons;  the  number  examined  during  1914  being  1,485,957. 
Of  this  number  41,250  were  certificated  for  deportation  on  account 
of  diseases  or  impaired  physical  condition. 

The  Division  of  Scientific  Research  is  conducting  investigations 
along  many  lines,  some  of  which  are  the  study  of  interstate  spread 
of  tuberculosis,  the  cause  and  cure  of  pellagra  and  leprosy,  the 
prevalence  and  prevention  of  malaria,  typhoid  fever  and  hook- 
worm, the  hygiene  of  schools  and  the  pollution  of  interstate  water- 
ways. The  Division  of  Publications  and  Statistics,  through  weekly 
Public  Health  Reports,  Reprints,  Bulletins  and  Supplements,  ren- 
ders the  information  so  gathered  accessible  and  useful  for  health 
officers  and  others  interested  in  sanitary  work. 

State,  county  and  city  health  departments,  throughout  the 
United  States,  are  developing  into  more  efficient  agencies  for  the 
prevention  of  disease.  Their  work  is  accomplished  largely  through 
building  regulations,  betterment  of  industrial  conditions,  inspec- 
tion of  milk  and  other  food  supplies,  regulating  the  disposal  of 
sewage  and  preventing  the  pollution  of  local  water  supplies,  in- 
spection of  schools,  the  elimination  of  insect  carriers  of  disease, 
such  as  mosquitoes  and  flies,  the  enforcement  of  vaccination,  and 
such  other  regulations  as  are  properly  the  function  of  State  and 
city  governments. 

In  addition  to  these  governmental  agencies  there  are  a  large 
number  of  organizations  accomplishing  much  for  the  cause  of 
sanitation.  Among  these  might  be  mentioned  the  Society  for  the 
Study  and  Prevention  of  Tuberculosis,  the  National  Committee 
for  I\Iental  Hygiene,  the  American  Social  Hygiene  Society,  Insur- 
ance Companies  and  many  large  industrial  corporations. 


WORLD'S  INSURANCE  CONGRESS  393 

Life  Insurance  Companies 

Life  insurance  companies  exert  a  most  constructive  influence  in 
enabling  better  economic  conditions  to  exist. 

In  the  program  of  this  World 's  Insurance  Congress  there  is  this 
statement  which  I  would  like  to  quote,  regarding  the  object  of  the 
second  day  of  the  Congress: 

' '  The  day  is  designed  to  bring  to  the  fore  the  part  that  insurance 
plays  in  consei-ving  and  bettering  citizenship  through  the  prolonga- 
tion of  life,  the  cementing  of  family  ties,  preventing  poverty,  the 
upholding  of  law  and  order,  maintaining  credit,  bettering  archi- 
tectural design  with  safety,  preventing  fires,  accidents  and  casu- 
alties of  all  character ;  improving  sanitation,  uplifting  the  individ- 
ual in  the  eyes  of  himself  and  the  community ;  and  ultimately  act- 
ing as  the  binder  which  draws  men  together  for  a  harmonious  per- 
petuation of  peaceful  pursuits  upon  a  constructive  basis." 

As  a  new  and  greater  San  Francisco  was  enabled  to  arise  from 
the  ruins  of  nine  years  ago  with  the  four  hundred  million  dollars 
from  insurance  companies,  so  are  the  lives  of  dependent  women 
and  children  protected  with  the  proceeds  of  the  life  insurance 
policy,  and  through  the  maintenance  of  the  home  and  opportunity 
for  education  the  value  of  human  lives  as  a  national  asset  is  greatly 
increased. 

The  actual  prevention  of  disease  and  improvement  of  living  con- 
ditions resulting  from  the  health  propaganda -of  insurance  com- 
panies are  of  great  value  to  the  citizens  of  our  country. 

It  is  probably  only  a  question  of  time  until  life  insurance  com- 
panies will  carry  out  their  welfare  work  on  some  such  similar 
scientific  basis  of  cooperation  as  the  "merit  system"  of  premiums 
now  practised  by  many  casualty  companies.  A  start  could  be  made 
with  the  merit  system  by  giving  the  total  abstainers  a  lower  rate, 
as  the  records  of  the  New  York  Life  Insurance  Company  show 
that  total  abstainers  have  a  death  rate  23  per  cent  lower  than  other 
classes  of  risks. 

It  has  already  been  stated  by  Messenger,  of  the  Travelers  In- 
surance Company,  that  if  the  insurance  companies  could  reduce 
their  death  claims  by  one  per  cent,  they  would  save  more  than 
eight  times  what  it  would  cost.  The  death  claims  could  be  reduced 
one  per  cent  through  a  campaign  of  public  health  education.  Suffi- 
cient funds  for  carrying  on  a  very  extensive  and  thorough  public 
health  work  could  be  obtained  if  the  thirteen  millions  of  dollars 
a  year  now  paid  by  insurance  companies  for  taxation  in  the  vari- 
ous States  could  be  set  aside  for  this  purpose. 

Even  the  surplus  of  this  tax,  after  deducting  all  expenses  for 
supervision  of  insurance  companies,  would  enable  much  valuable 
public  health  work  to  be  financed.  And  no  doubt  the  day  will  come 
when  State  authorities  will  see  the  reasonableness  of  such  a  dis- 


394  WORLD'S  INSURANCE  CONGRESS 

position  of  these  funds,  gathered  from  the  thrifty  citizens  that 
are  protecting  their  families. 

The  object  in  presenting  the  subject  of  "Human  Life  as  a 
National  Asset"  in  this  manner  is  to  show  that  we  as  a  nation 
are  not  careful  enough  in  protecting  our  greatest  asset.  Through 
neglect  of  physical  conditions  of  childhood,  such  as  are  found  on 
inspection  of  school  children,  neglect  of  education  in  trying  to 
have  children  earn  money,  or  through  economic  conditions  prac- 
tically forcing  many  persons  to  become  unable  to  give  the  right 
start  to  their  offspring,  the  value  of  individuals  as  citizens  is 
greatly  impaired. 

The  ravages  of  preventable  diseases  cause  the  loss  of  many 
thousands  of  valuable  lives,  and  much  human  capital  is  thus 
wasted. 

No  greater  return  can  be  secured  from  an  investment  than  can 
be  gained  from  money  spent  to  fight  disease  through  sanitation. 
Improved  sanitary  and  economic  conditions  save  lives,  promote 
health,  result  in  happiness,  and  make  possible  the  acquisition  of 
wealth,  both  for  the  individual  and  the  Nation. 


WHAT  THE  PANAMA-PACIFIC  INTERNATIONAL  EXPO- 
SITION IS   DOING   FOR  THE    CAUSE   OF   LIFE 
CONSERVATION 

By  Alvin  E.  Pope 
Chief,  Department  of  Education  and  Social  Economy 

An  exposition  is  a  great  educator.  It  is  an  organization  whose 
function  is  to  collect  ideas  from  each  and  every  part  of  the  world 
and  transmit  them  throughout  the  nations.  It  collects  new  ideas, 
isolated  ideas,  ideas  confined  to  a  few  individuals,  ideas  restricted 
to  a  small  territory — and  spreads  them  throughout  the  civilized 
world.  It  collects  well-known  ideas  and  makes  them  better  known 
by  extending  them  into  localities  where  they  were  previously  un- 
known. It  also  stimulates  those  who  participate  in  the  exposition 
to  the  discovery  of  new  ideas.  The  millions  of  people  visiting  an 
exposition  carry  these  ideas  home  and  distribute  them  throughout 
their  respective  communities.  These  ideas  soon  become  the  nuclei 
for  nation-wide  movements ;  thus  they  live  forever  in  the  minds  of 
those  who  saw  and  stopped  to  learn. 

The  division  of  Exhibits  is  divided  into  several  departments 
which  deal  with  such  subjects  as  Machinery,  ]\Tanufactured  Prod- 
ucts, Agricultural  Products,  Live  Stock,  Social  Economy,  etc. 
Social  Economy  is  that  dojiartment  which  deals  with  man,  both  as 
an  individual  and  as  a  member  of  a  community.  Education,  tlico- 
retically,  is  a  branch  of  Social  Economy,  but  on  account  of  the 


WORLD'S  INSURANCE  CONGRESS  395 

extent  of  its  activities  a  separate  department  has  been  created  for 
it.  The  policy  of  the  Department  of  Social  Economy  has  been 
from  the  first  to  emphasize  Life  Conservation. 

The  Panama-Pacific  International  Exposition  is  held  in  com- 
memoration of  the  completion  of  the  Panama  Canal,  The  com- 
pletion in  the  Canal  was  made  possible  only  by  the  rigid  applica- 
tion of  modern  principles  of  hygiene.  The  French  had  the  engi- 
neers, the  equipment,  the  capital,  and  the  energy  to  have  com- 
pleted the  Canal,  but  they  lacked  knowledge  of  the  rules  of  modem 
hygiene.  They  placed  little  basins  of  water  under  the  legs  of  the 
tables  and  beds  to  prevent  the  annoyance  of  insects.  In  those 
basins  were  hatched  the  mosquitoes  which  carried  the  deadly  yel- 
low fever  and  malaria  germs.  These  diseases  completely  debili- 
tated the  working  force  and  led  to  the  disintegration  of  their  whole 
organization. 

Therefore,  it  is  fitting  not  only  that  the  Department  of  Social 
Economy  should  recognize  Life  Conservation  but  that  a  special 
day  should  be  set  aside  to  do  honor  to  the  forces  which  made  pos- 
sible the  completion  of  the  Panama  Canal. 

In  early  childhood  we  fear  the  dark  and  the  bogie  man.  The 
ignorant  live  in  terror  of  ghosts,  goblins  and  loup  garous.  The 
timid  fear  mice,  bats,  snakes,  thunder,  etc.  None  of  these  harm 
us.  On  the  other  hand,  we  do  not  fear  the  fly,  the  mosquito  or 
the  flea,  which  are  often  the  carriers  of  disease.  Our  great  enemies 
are  small,  some  of  them  so  small  we  cannot  see  them  with  the 
naked  eye.  The  malaria  germ  prevents  the  creation  of  more  prop- 
erty ;  it  causes  more  poverty  and  disease  in  one  year  than  the 
European  War.  The  hookworm,  tuberculosis  and  cancer  each  are 
more  destructive  than  the  horrible  conflict  now  raging  in  Europe. 
Likewise,  it  is  our  little  daily  habits,  which  we  do  not  fear,  that 
undermine  our  constitution — habits  which  are  more  dangerous 
than  the  gi'eat  calamities  we  so  dread. 

We  have  before  us  to-day  the  Generals  who  are  conducting  the 
campaign  for  the  Conservation  of  Life — Health,  Happiness  and 
Prosperity;  who  are  waging  a  war  against  poverty,  misery  and 
disease.  They  attack  these  forces  from  the  standpoint  of  preven- 
tion and  efficieney.  This  war  is  carried  on  principally  by  educat- 
ing the  public.  In  all  civilized  governments  progress  must  be 
made  by  enlightening  the  common  people.  Reforms  cannot  pro- 
ceed far  unless  the  public  knows  the  reason  for  the  reform.  It 
is  dangerous  to  abandon  the  public  and  leave  the  field  to  quacks 
and  mountebanks. 

The  Panama-Pacific  International  Exposition  is  one  of  the 
world's  greatest  factors  in  teaching  the  public.  The  Department 
of  Social  Economy  was  organized  with  the  one  desire  to  teach  the 
lesson  of  Life  Conservation  to  the  multitudes  visiting  the  Exposi- 
tion, to  teach  them  so  efi'ectively  that  these  lessons  will  become  the 
nuclei  of  great  movements.  The  future  of  the  nation,  the  future 
of  the  race,  the  future  of  civilization  depend  upon  these  principles. 


396       WORLD'S  INSURANCE  CONGRESS 

It  is  not  only  possible  to  eradicate  every  contagious  disease  but 
to  annihilate'  all  these  evils.  We  must  begin  by  reducing  their 
ravages,  and  our  motto  shall  ever  be  Reduce,  Reduce,  Reduce. 

LIFE  CONSERVATION  AND  MEDICINE 

By  Db.  Harry  M.  Sherman 

President,   California  Association  for  the  Study  and  Prevention 

of  Tuberculosis 

At  a  time  when  large  enterprises,  under  the  auspices  of  a  larger 
enterprise,  come  together  to  accentuate  and  celebrate  the  conserva- 
tion of  human  health  and  life,  it  is  impossible  that  medicine  shall 
not  be  represented  and  be  heard  from.     Really,  it  seems  to  me,  if 
there  were  no  personal  representative  of  Medicine  present  here 
this  day,  IMedicine  would  still  be  represented— the  Medicine  which 
heals  and  the  sister  Medicine  which  prevents — for  nothing  that 
can  be  done  or  planned  for  any  conservation  of  human  health 
and  human  life  can  escape  from  being  part  of  Medicine,  and  by 
medicine  I  mean  that  broad,  universal  impersonal  endeavor  to  pre- 
vent or  to  heal — so  long  as  the  endeavor  is  based  on  accurate 
knowledge  of  conditions  and   processes   and  sicentifically  logical 
workings  out  of  the  methods  to  be  employed.    It  is  impossible  that 
a  science  and  an  art  which  has  been  studied,  elaborated  and  prac- 
tised for  twenty-five  hundred  consecutive  years — a  science  and  an 
art  that  is,  then,  older  than  the   Christian  religion — should  not 
have  a  control  which  must  make  it  the  dominating  power  in  every- 
thing pertaining  to  human  life.     jNIedicine  meets  each  one  of  you 
when  you  first  enter  life.     Medicine  takes  each  little  child  by  the 
hand  and  conducts  it  through  its  play  and  its  rest.     :Medicine  de- 
cides the  life  of  a  youth.    Medicine  controls  the  development  of  the 
man.     IMedicine  follows  us  as  we  go  down  into  the  vale  of  years; 
and  ]\Tedicine  finally  is  by  our  side  when  we  slip  out  into  the 
great  sea  that  is  somewhere  beyond.     In  its  self-appointed  guar- 
dianship of  life  from  life's  morn  until  its  eve,  what  has  IMedicine 
put  upon  its  own  shoulders,  what  has  it  demanded  of  itself  in  the 
way  of  preparation,  what  tests  has  it  set  forth  by  which  those  fit 
shall  be  judged,  what  has  it  done  in  this  field  which  it  so  broadly 
claims  as  its  own?     It  is  repeating  history  to  tell  you  that  from 
the  time  when  the  father  of  Medicine — Hippocrates — twenty-five 
centuries  ago,  first  talked  about  observation  of  disease  as  a  means 
of  gaining  knowledge  of  its  natural  history.  Medicine  has  pursued 
the  path   indicated  by  him  and   has  constantly  been  true  to  the 
scientific  ideal  of  learning,  of  knowing  and  of  practising.     It  has 
kept  to  this  ideal  undeviatingly,  in  spite  of  all  possible  "isms" 
and  "pathies"  which  have,  from  the  beginning  even  until  now, 
hung  upon  the  skirts  and  followed  in  its  footsteps.     It  has  kept 


WORLD'S  INSURANCE  CONGRESS  397 

in  this  same  path  through  all  of  the  changes  which  have  occurred 
among  crowned  heads  and  governments;  the  falling  of  a  nation 
or  the  founding  of  a  new  one  have  been  but  side  incidents  in  the 
progress  of  medical  study,  and  while  Medicine  has  been  in  and  a 
part  of  every  government  in  every  place,  it  still  has  not  been  in 
any  way  controlled  or  dominated  in  its  final  form  and  intent  by 
any  of  the  laws  of  man,  just  as  no  man  made  laws  can  modify  or 
suspend  natural  spontaneous  phenomenon. 

Advancing  thus  from  one  point  of  knowledge  to  another,  though 
not  without  periods  of  delay  or  almost  retrogression,  and  after 
holding  back  from  man's  apprehension  for  long  stretches  of  time, 
the  secrets  he  has  struggled  to  learn,  Medicine  comes  to  you  to- 
day, a  science  and  an  art — a  vast  fund  of  knowledge  to  which 
every  other  science,  and  every  art,  and  every  corner  of  the  round 
world  has  contributed,  and  a  procedure  based  upon  that  knowledge 
which  has  preserved  health,  lessened  suifering  and  postponed,  in 
countless  instances,  the  inevitable  end  which  we  all  must  meet. 

Matter,  as  we  see  it  about  us  and  in  us,  consists  of  that  which 
is  lifeless  and  that  which  lives,  and  the  living  consists  of  the  un- 
conscious living  and  the  conscious  living,  and  the  conscious  living 
includes  man.  To  extend  in  time  that  phenomenon  of  matter,  life 
— conscious  life — is  to  continue  the  most  subtle  and  complex  of 
chemical  combinations  and  reactions,  and  to  control,  for  the  time 
being,  life.  How  far  Medicine  has  gone  on  this  path  no  one  here, 
not  even  the  simplest,  can  avoid  knowing — in  part  at  least;  how 
far  Medicine  can  go  no  one  here,  not  even  the  wisest,  can  foretell, 
except  that  all  will  probably  agree  that  Medicine  will  never  un- 
ravel that  master  secret  which  would  tell  just  where  the  dead  and 
the  living  are  separate,  the  dead  ending  and  the  living  beginning 
— but  until  that  point,  all  is  possible. 

In  saying  that  Medicine  has  been  unaffected  by  the  laws  of  man 
I  do  not  forget,  nor  mean  to  say,  that  the  practice  of  Medicine  is 
so  exempt.  Fortunately  for  us  the  reverse  is  true — for  in  every 
civilized  state  man  made  laws  control  the  exercise  of  the  knowledge 
of  the  nature  made  laws  of  Medicine,  just  as  they  control  the  exer- 
cise of  the  knowledge  of  the  nature  made  laws  of  physics  by  the 
engineer,  and  the  exercise  of  the  knowledge  of  the  nature  made 
laws  of  chemistry  by  the  chemist.  Laws  have  very  wisely  been 
passed  which  control  medical  practitioners  and  indicate  how  much 
study  medical  students  should  do  before  they  are  given  legal  right 
to  practise,  but  the  point  that  I  wish  to  make  here  is  that  Medi- 
cine itself  has  always  been  the  instigator  in  the  passing  of  those 
laws,  and  that  it  has  had  always  to  plead  for  a  higher  ideal  and 
higher  standards  than  the  laws  themselves  ever  gave.  (And  then  in 
its  own  place,  Medicine  has  pursued  its  goal,  quite  beyond  the  im- 
pulse or  restraint  or  the  control  of  any  law.)  It  is  a  truth  that 
in  this  United  States  of  ours  there  is  not  one  State  which  has 
medical  laws  upon  its  statute  books,  and  they  all  have  them,  in 
which  those  laws  were  not  primarily  put  there  by  the  initiative 


398       WORLD'S  INSURANCE  CONGRESS 

and  on  tlie  insistence  of  the  medical  profession,  and  always,  also, 
have  these  laws  been  set  to  a  lower  scale  than  that  which  the  medi- 
cal profession  itself  asked  for.  Protests  against  prolonged  prepa- 
ration and  exacting  tests  of  fitness  by  those  anxious  for  an  easy 
road  into  the  practising  of  some  phase  of  the  healing  art  have 
always  been  listened  to  by  legislators,  and  the  standards  asked  for 
by  Medicine  have  been  toned  down  to  meet  the  desires  of  these 
lower  groups.  Legal  protection  of  the  medical  profession  by  med- 
ical legislation,  as  it  is  thought  to  be  by  the  unobservant,  really  is 
legal  protection  of  the  layman,  for  these  laws  which  forbid  others 
than  the  properly  instructed  and  thoroughly  qualified  man  to 
undertake  the  task  of  healing  the  sick — and  in  doing  so  assuming 
the  responsibility  for  the  perpetuation  of  the  phenomenon  of  life 
— put  upon  the  medical  student  the  tasks  of  becoming  thoroughly 
proficient  in  everything  of  hand  and  head  and  heart  which  go  to 
make  him  a  competent  practitioner,  tasks  which  are  so  heavy  that 
at  the  present  time  more  than  seven  consecutive  years  of  unremit- 
ting study  alone  will  fit  a  man  to  qualify ;  and  while  the  law  does 
say  that  from  that  time  on  he  and  he  alone  shall  have  the  privilege 
of  caring  for  the  sick,  the  law  puts  no  limit  to  the  number  of  those 
who  may  so  qualify,  provided  that  they  have  the  necessary  under- 
standing and  energy;  so  that  there  need  be  no  limit  to  those  who 
seek  to  become  ministers  or  servants  in  fighting  disease. 

The  monopoly  is  not  a  monopoly  in  the  fact  that  there  is  no  ex- 
clusion of  the  fit.  It  is  only  a  monopoly  in  that  sense  which  is 
praiseworthy — the  sense  that  only  those  who  are  qualified  to  carry 
the  burden  shall  put  out  their  hands  to  take  up  the  load. 

Outside  of  this  phase,  what  is  Medicine  doing?  Wliat  standards 
is  it  setting  for  itself,  independent  of  State  control?  How  is  it 
preparing  to  meet  the  problems  of  to-morrow?  Where  has  it  set 
the  mark  beyond  which  it  would  say  "I  can  go  no  further"? 

The  past  must  be  the  index  of  the  present  and  of  the  future, 
and  with  such  facts  to  its  credit  as  the  mastery  of  malaria,  and 
of  yellow  fever,  the  throttling  of  smallpox,  the  curing  of  diph- 
theria, the  prevention  of  bubonic  plagues,  the  practical  exclusion, 
through  preventive  injections,  of  typhoid,  the  real  domination  of 
tuberculosis,  and  finally,  the  message  for  which  many  have  waited 
in  the  past  in  vain,  but  which  can  now  be  given  with  an  assur- 
ance of  its  absolute  truth — the  control  of  cancer — with  these  facts 
accomplished  facts,  and  all  of  them  within  recent  history — many 
of  them  within  the  recollection  of  those  present — who  can  tell  what 
may  be  the  discoveries  and  accomplisliment  of  the  next  decade  or 
the  next  score  of  years  of  the  next  half-century?  This  question 
is  all  the  more  inspiring  if  it  is  remembered  that  the  standards  of 
the  past — the  standards  under  which  what  I  have  recited  has  been 
accomplished — will  be  the  standards  of  the  future,  that  there  will 
be  no  let-up  in  energy,  no  slackening  of  effort,  that  there  will  prac- 
tically and  actually  be  an  observer  present  to  observe  eveiy  most 
minute  phase  of  anatomy,  physiology,  biolog>%  and  pathology,  and 


WORLD'S  INSURANCE  CONGRESS  399 

physics,  wliicli  can  affect  in  any  way,  even  in  the  most  insignificant 
of  ways,  the  control  of  all  disease,  and  its  proximate  elimination 
which  is  the  ultimate  goal  of  Medicine. 

It  is  by  this  mastery  of  the  problems  of  to-day  that  medicine  is 
preparing  to  meet  the  problems  of  to-morrow,  preparing  through 
sanitation  to  lessen  hostile  elements  to  life,  preparing  through  sur- 
gery and  international  medicine  to  control  diseases  already  estab- 
lished, and  nowhere  has  there  ever  been  placed  and  nowhere  can 
there  ever  be  placed  a  limit  beyond  which  it  will  not  go ;  for  just 
as  sure  as  there  will  always  be  a  to-morrow,  so  that  to-morrow  Avill 
always  have  its  tasks  for  men. 

The  conservation  of  health  and  life,  the  keeping  of  that  God 
made  and  Nature  given  gift — conscious  and  intelligent  life — why, 
every  act  of  ]\Iedicine,  from  the  doses  given  by  the  mother  to  the 
child  in  the  nursery  to  the  major  surgeon  in  the  operating  room, 
have  each  that  motive — conservation  of  conscious  life.  Every 
phase  of  medical  activity,  every  observation  of  a  natural  phenom- 
enon which  may  have,  even  remotely,  an  effect  upon  living  organ- 
isms, every  dollar  spent  in  buildings  for  medical  study  and  re- 
search, and  every  stone  or  brick  laid  in  the  construction  of  these 
buildings  has  the  same  great  object,  the  conservation  of  health  and 
the  prolongation  of  conscious  life,  the  extension  of  the  ability  to 
think — the  keeping  of  a  man. 

Now  for  this  great  purpose  Medicine  is  doing  certain  specific 
things  and  these  things  you  should  know  and  remember. 

In  the  first  place,  Medicine  is  accepting  as  her  ministers  only 
those  who  are  properly  prepared  and  fit.  The  medical  student 
of  to-day  practically  begins  his  studies  for  his  medical  work  in 
the  secondary  schools — makes  that  more  definite  in  the  high  school 
and  must  have  made  a  specific  choice  of  his  life  work  as  he  enters 
the  university.  Now  from  this  time  to  his  degree  is  six  or  seven 
years— one-tenth  or  one-twelfth  of  the  Biblical  promise  of  life. 

This  plainly  can  be  done  only  at  a  tremendous  cost  of  effort  and 
energy,  but  in  addition  to  this  the  cost  in  money  is  so  great  that 
none  but  those  more  than  ordinarily  provided  with  money  could 
expect  to  pay  for  the  instruction;  and  so  the  great  universities 
have  taken  up  the  task,  and  out  of  large  funds  supply,  for  a  price 
that  is  within  the  means  of  the  average  man,  adequate  medical 
instruction. 

This  is  one  of  the  debts  which  the  people  owe  to  the  universities 
— a  debt  that  must  always  grow,  and  a  relation  of  the  people  to 
the  universities  that  must  alwaj^s  be  more  and  more  intimate,  and 
that  for  this  reason : 

The  civil  engineer,  university  bred,  the  people  never  know  as 
such  unless  he  has  official  position — or  builds  great  works  which 
make  his  name  so  famous  that  he  is  removed  from  ordinaiy  classi- 
fication. There  is  nothing  obviously  intimate  between  him  and 
individual  human  health  or  human  life. 

The  lawyer,  university  bred,  touches  the  life  of  practically  every 


400       WORLD'S  INSURANCE  CONGRESS 

ii^an — but  only  in  its  civil  or  social  relations,  and  both  of  these  re- 
lations may  be  apart  from  the  personal  life  of  the  individual.  He 
never  knows  all  there  is  to  know  of  his  client. 

The  clergyman,  university  bred,  also  touches  the  life  of  prac- 
tically every  man — he  gives  him  admission  to  church,  and  bless- 
ings on  great  epochs  and  events,  and  lastly  smooths  the  tired  road 
of  doubt  to  the  sleep  of  final  content.  But,  even  he  never  knows 
all  that  there  is  to  know  about  his  charge.  There  are  things  which 
are  not  told  to  him  and  vt^hich  he  knows  not  how  to  find  out. 

The  physician,  he,  too,  university  bred,  comes  from  the  univer- 
sity, through  the  hospital,  to  the  sick  room  and  the  nursery.  He 
meets  you  in  the  closest  association,  he  touches  the  persons  of  your- 
selves, and  the  persons  of  your  wives  and  of  your  daughters.  He 
does  more — he  suspends  your  consciousness,  he  opens  your  bodies 
and  he  tests,  he  analyzes — he  discovers  and  he  knows.  There  are 
very  few  secrets — personal  secrets — that  can  be  kept  from  him. 
And  through  him,  through  his  most  intimate  relations,  the  univer- 
sities and  the  medical  schools  come  into  a  very  real  relation  with 
the  lives  of  men  and  women  that  is  exceeded  by  no  other.  In  this 
way  Medicine  is  endeavoring  to  prepare  for  you  able  and  trust- 
w^orthy  practitioners — who  will  help  you  and  not  harm  you — and 
in  whose  care  all  those  who  are  dearest  to  you  will  be  safe. 

Afterwards — in  his  profession — the  medical  man  is  kept  up  to 
the  mark  in  his  work  by  the  stimulus  of  competition  which  is  regu- 
lated by  his  societies.  He  is  made  to  continue  study  and  to  accu- 
mulate knowledge  and  gain  experience  and  is  definitely  prevented 
from  that  retrogression  which  is  always  present  when  progress  is 
not.  These  facts  are  alluded  to  because  the  object  of  societies  of 
medical  men  is  not  understood  by  many  men  in  this  essential  char- 
acteristic. But — and  of  this  I  am  sure — the  time  is  coming  when 
toward  these  same  societies  the  layman  will  have  a  debt  of  grati- 
tude equal  to  that  which  he  will  and  does  even  now  owe  the  uni- 
versity; for  the  time  is  coming  when  medical  societies,  in  States 
and  for  the  whole  country,  will  require  an  examination  for  ad- 
mission to  supplement  and  to  make  up  for  the  inadequate  protec- 
tion against  incompetence  now  afforded  by  the  State,  At  that  time 
there  will  be  no  danger  of  not  knowing  the  rating  of  the  man  who 
comes  into  your  house  to  care  for  your  sick.  Either  he  will  belong 
to  the  profession  of  jMedicine — the  Medicine  that  has  given  you  all 
that  I  have  enumerated  and  more,  and,  mind  you,  nothing  apart 
from  Medicine  has  ever  given  you  any  such  thing — or  he  will  not 
be  of  the  profession  of  INIedicine. 

Finally,  and  chiefl.y  in  the  last  score  of  years,  IMedicine  is  es- 
tablishing laboratories  of  investigation  and  research.  Here  the 
problems  of  the  cause  of  disease,  of  the  healing  of  the  sick,  and 
the  repair  of  injuries — all  reduced  to  their  simplest  terms — are 
studied  in  detail,  and  so  the  complex  is  comprehended.  Here  in 
this  city,  by  the  generosity  of  one  of  our  fellow  citizens,  is  already 
the   Hooper   Foundation    for   Medical   Research — given    into    the 


WORLD'S  INSURANCE  CONGRESS  401 

charge  of  the  University  of  California,  the  university  that  belongs 
to  the  State,  and  that  is  owned,  in  part,  by  every  citizen  of  Cali- 
fornia, and  in  the  success  and  glory  of  which  every  Californian 
has  an  interest,  no  matter  what  may  be  his  other  affiliations  or 
relations.  Here  Medicine  and  the  University,  together,  are  again 
working  for  health  conservation  and  life  prolongation. 

Up  to  the  present  time  I  have  been  speaking  of  Medicine  and  its 
relation  to  conservation  of  health  and  life,  but  this  is  only  one  side 
of  the  question.  How  about  the  other  side?  How  about  you — 
the  layman  whose  health  and  lives  Medicine  is  planning  to  con- 
serve? How  about  us  medical  men  who  always  become  laymen 
w^hen  we  get  sick,  and  who  unhappily  share  with  the  rest  of  man- 
kind, the  tendencies  to  do  not  the  wisest  things  always — and  who 
suffer  with  you  the  ills  of  the  flesh? 

What  attitude  does  Medicine  ask  of  you  ?  What  part  must  you 
play  in  this  great  scheme  that  you  may  profit  by  it  and  through 
it  be  saved? 

In  he  first  place.  Medicine  asks  of  you  comprehension — and  an 
understanding  and  collaboration.  Medicine  asks  of  you  no  faith 
— no  believing.  Medicine  to-day  has  nothing  occult  which  requires 
an  act  of  faith — nothing  incomprehensible  which  requires  blind 
believing.  Medicine  knows,  or  it  does  not  know — but,  what  it  does 
not  know  is  of  no  different  a  nature  from  what  it  knows,  and  as 
each  new  bit  of  knowledge  is  acquired  it  fits  into  its  place  among 
the  things  known  and  makes  no  break  in  the  pattern.  Medicine 
asks  and  demands  the  appreciation  of  the  men  working  in  Medi- 
cine, of  the  men  not  working  in  Medicine,  for  it  is  only  to  those 
who  appreciate,  who  understand,  who  collaborate,  that  Medicine 
can  give  its  best — for  these  it  has  much  to  give  generously.  For 
those  who  appreciate,  who  understand,  who  collaborate  and  who 
come  for  help  soon,  early — ]\Iedicine  can  give  and  is  even  now  giv- 
ing definite  hope  and  specific  control  of  that  which  has  in  the  past 
disappointed  hopes  and  baffled  effort — that  death  in  life — cancer. 
These  are  no  idle  words  uttered  to  complete  a  phrase  or  round  out 
a  sentence.  They  are  said  in  all  honesty  and  seriousness.  The  con- 
trol of  cancer  is  an  accomplished  fact — if  you  appreciate,  and  un- 
derstand, and  collaborate. 

And  to  those  who  do  not  or  cannot  appreciate  and  understand 
and  collaborate — because  they  believe  something  else — to  those 
when  they  come,  for  come  they  do,  even  though  it  be  at  the  elev- 
enth hour,  Medicine  again  holds  out  a  willing  hand  and  offers 
relief  or  help  in  proportion  to  the  needs,  and  to  Medicine 's  ability. 
In  its  catholicity  of  service  Medicine  recognizes  no  bar  to  an  ap- 
plicant, no  rule  of  exclusion.  Medicine  is  part  of  Nature.  Medi- 
cine is  Nature's  reparation — and  so  belongs  and  is  given  to  all 
the  children  of  Nature. 


402  ^YORLD'S  INSURANCE  CONGRESS 

LIFE  CONSERVATION  AND  SOCIAL  ECONOIMY  * 

By  Miles  Menander  Dawson 
Consulting  Actuary- 
There  are  two  ways  in  which  the  lives  of  individuals  may  be 
made  most  useful  to  their  fellows,  viz.:  (1)  by  increasing  their 
capacity  for  service  and  (2)  by  maintaining  them  alive  and  in 
condition  to  serve  in  the  largest  possible  numbers  until  ability 
to  be  of  service  shall  be   exhausted. 

That  length  of  j^ears  may  be  useful  to  others,  there  must  be  both 
the  will  and  the  power  to  serve ;  but,  granted  those  things,  length 
of  years,  up  to  the  age  at  which  the  strength  normally  begins  to 
fail,  should  make  for  increased  capacity  for  serving  others. 

There  is,  therefore,  in  the  conservation  of  life  great  possibilities 
of  good  for  humanity,  both  in  that  there  w411,  or  should,  be  greater 
ability  to  serve  as  well  as  more  years  in  which  service  is  afforded. 
This  may  be  illustrated  in  the  following  ways:  Suppose  that 
the  generation  about  to  be  born  should  succumb  entirely  before 
passing  the  years  of  infancy ;  there  would  then  be  no  balance  of 
service  of  others  at  all,  because  infancy  requires  a  balance  of  ser- 
vice instead  of  bestowing  it.  Or  suppose  that  the  population  sur- 
vives, on  the  average,  only  to  age  35,  and,  if  you  please,  that  to 
age  20  the  individual  produces  no  balance  of  service  over  his  o^vn 
requirements,  but  instead  the  contrary.  Then,  obviously,  if  this 
average  meant  that  all  survived  to  age  35  and  thereupon  died, 
each  would  live  but  15  years  during  which  he  would,  or  at  least 
might,  be  of  service  to  others ;  and  since  all  who  live  beyond  age 
20  have  survived  all  the  years  of  age  up  to  age  20,  while  others 
have  died  before  reaching  that  age,  to  say  that  all  average  to  live 
to  age  35  means  that,  for  each  person  born,  an  average  of  more 
than  15  years'  service  of  others  is  had.  This  may  mean,  how^ever, 
say  40  years  or  more  on  the  average  for  tliose  who  have  survived 
to  age  20.  The  average  excess  over  age  20  may  nevertheless,  be 
taken  for  rough  but  illuminating  comparisons,  as  relatively  sig- 
nificant. 

Life  conservation,  then,  so  far  as  it  can  possibh^  affect  society 
favorably,  is,  first,  the  bringing  to  maturity,  say,  age  20,  of  as 
many  persons  capable  of  serving  as  possible  and  their  preser\'ation 
in  as  large  numbers  as  possible  through  the  years  up  to  age  70 
at  least,  or  even  80,  or  such  higlier  age  as  witnesses  the  disappear- 
ance of  ability  to  serve  or  at  least  a  clear  preponderance  of  need 
for  service  over  ability  to  give  service. 

In  Germany,  where  public  sickness  insurance  on  a  compulsory 
basis  has  been  provided  for  wage-earners  since  1884,  the  insured 
employees  contributing  two-thirds  and  their  employers  one-third, 
their  respective  representation  on  the  governing  board  being  pro- 

*  Not  read. 


WORLD'S  INSURANCE  CONGRESS  403 

portionate,  the  result,  according  to  Dr.  Zacher,  President  of  the 
Imperial  Statistical  Office  and  the  highest  living  authority  on  so- 
cial insurance,  has  been  that  the  average  age  attained  at  the  time 
of  death  has  been  increased  from  38.1  to  48.85  years  for  men  and 
from  42.5  to  54.9  years  for  women  in  the  course  of  the  30  years 
from  1870  to  1900.  No  such  remarkable  increase  in  average  lon- 
gevity has  ever  previously  been  noted  and  it  may  be  confidently  as- 
serted that  this  experience  is  utterly  unprecedented. 

Taking  age  20  as  the  adult  age  at  which  one  reaches  the  stage 
of  producing  more  than  is  absolutely  needed  for  his  own  support 
and  thus  creates  a  social  balance,  this  means  an  average  life  of 
social  service  per  male  person  born,  relatively,  of  28.85  years  in- 
stead of  18.1  years,  an  increase  of  very  nearly  60  per  cent  in  the 
number  of  years  and,  assuming  increasing  efficiency  proportionate 
to  years  of  such  service  (which  is  perhaps  nearly  fair  on  the  aver- 
age), much  more  than  60  per  cent  increase  in  the  quantity  and 
quality  of  the  social  service.  If  an  average  improvement  in  effi- 
ciency of  but  five  per  cent  per  annum  were  assumed,  the  summed 
product  of  the  efficiency  represented  by  the  new  average  longevity 
of  say  29  years  beyond  age  20  would  be  61.32  per  male  per- 
son born,  as  against  29.54  for  the  old  average  longevity  of  say  18 
years  beyond  age  20,  or  more  than  double.  Nothing  can  be 
claimed  for  the  correctness  of  this  assumption  which  may  be  over 
or  under  the  fact,  but,  while  it  is  true  that  the  average  rate  of  in- 
crease of  efficiency  would  in  fact  be  high  at  the  outset  and  low  or 
even  negative  at  old  age,  it  is  also  unquestionably  true  that  the 
benefit  to  society  of  this  increased  longevity  is  much  greater  than 
the  mere  rate  of  augmentation  of  the  average  longevity  beyond  age 
20.  The  increase  in  the  average  productivity  of  men  beyond  the 
age  20  must,  I  should  say,  be  at  least  doubled.  This  means  a 
higher  standard  of  living  for  the  entire  people. 

The  foregoing  is  not,  of  course,  the  view  which  the  individual 
has  of  the  conservation  of  his  life.  Nature  has  implanted  in  each 
the  will  to  live,  at  least  so  long  as  he  can  do  so  without  intolerable 
pain,  and  next  to  that  the  will  to  enjoy.  But  society,  which  means 
a  man's  fellows,  is  not  interested  in  his  living  when  his  life  pro- 
duces no  balance  of  benefit  to  the  whole. 

If,  therefore,  life  conservation  were  merely  the  preservation  of 
lives  which  absorb  from  the  goods  and  services  produced  by  man- 
kind more  than  they  contribute,  it  would  not  be  economical  from 
a  social  point  of  view  at  all. 

Fortunately  Nature  has  so  designed  man  that,  when  he  with- 
draws from  action,  his  powers  soon  disintegrate  and  his  life,  spent 
in  self-gratification  only,  is  likely  to  be  short-ended.  It  is  only 
the  active  parasite,  bent  upon  preying  upon  others,  who  may, 
notwithstanding,  be  preserved  like  wolves  and  cormorants,  through 
his  very  activity.  But  with  these,  social  economy  is  not  otherwise 
concerned  except  that  they  should,  if  possible,  be  transmuted  into 


404  WORLD'S  INSURANCE  CONGRESS 

useful  citizens;  otherwise,  society  is  certainly  not  interested  in 
prolonging  their  lives. 

As  regards  the  socially  valuable,  what  then  is  the  problem? 
Plainly,  to  bring  to  maturity  as  large  a  proportion  as  possible 
of  those  who  are  born  and  to  carry  as  many  of  these  as  possible 
safely  through  the  years  of  productivity  and  up  to  old  age. 

As  regards  society  as  a  whole,  it  is  not  important  whether  a 
larger  or  a  smaller  number  be  born,  though  it  may  be  significant 
as  to  whether  or  not  a  nation  shall  hold  its  own  against  other  na- 
tions in  trade  or  war;  but  society  as  a  whole  is  concerned  exclu- 
sively about  the  quality  and  serviceability  of  the  children  that  are 
born  into  the  world,  and  future  generations,  though  limited  in 
numbers,  would  be  better  served  if  fewer  and  better  children  set 
out  in  their  generations,  respectively.  But  that  is  another  ques- 
tion; we  here  discuss  not  the  generation  but  the  conservation  of 
human  beings. 

Yet  right  at  the  threshold  of  our  chosen  subject,  in  considering 
how  as  large  a  proportion  as  possible  of  those  who  are  born  may 
be  brought  to  maturity,  it  is  plain  that  these  chances  will  be  much 
increased  if  children  are  well-born,  that  is,  of  strong  and  healthy 
parents,  and  are  brought  into  the  world  under  the  most  hygienic 
and  sanitary  conditions.  It  is  not,  therefore,  feasible  wholly  to 
omit  mention  of  eugenics  from  a  discussion  of  life  conservation 
and  social  economy,  because  to  be  well-born  makes  both  for  vitality 
which  is  requisite  to  length  of  years  and  for  vigor  which  by  over- 
flowing one's  own  requirements  enables  society  to  be  served. 

As  regards  procreation  by  strong  and  healthy  parents,  society 
is  already  alive  to  the  desirability  of  the  inhibition  of  marriage 
in  certain  cases.  Control  over  individuals  in  this  regard  is,  how- 
ever, most  difficult  and,  if  men  are  to  be  free  but  accountable  for 
abuse  of  f  j-eedom,  undesirable  except  as  to  persons  who,  by  reason 
of  feeble  or  depraved  minds,  are  really  irresponsible.  Among  hu- 
man beings,  it  is  most  probable  that  the  true  solution  is  in  greater 
freedom  and  particularly  in  saner  views  of  life,  which  together 
might  make  the  selection  of  mates  by  the  females  of  the  human 
race  more  certainly  effective.  The  fact  that  hybrids  are  almost 
invariably  children  of  mothers  of  the  inferior  race  and  of  fathers 
of  the  superior  race  shows  that  among  females  of  all  these  races 
the  influence  of  sexual  selection  is  at  least  as  powerful  as  among 
lower  forms  of  life  where  Darwin  first  discovered  that  it  was 
operating.  Few  women,  indeed,  would  with  eyes  open  and  unde- 
luded,  if  in  perfect  freedom  to  choose,  select  weak,  diseased  or 
defective  fathers  for  their  children.  But  this  also  lies  without 
the  province  of  this  address. 

As  regards  care  during  confinement,  delivery  and  lactation, 
this  comes  very  directly  within  the  scope  of  this  paper,  but  it 
const itutos  a  part  only  of  the  general  consideration  of  provision 
for  sickness  which  is  here  proposed.    Accordingly,  it  is  postponed, 


WORLD'S  INSURANCE  CONGRESS  405 

to  be  taken  up  with  sickness  insurance  in  general,  with  respect 
to  life  conservation. 

The  foregoing  clears  the  ground  entirely  so  that  we  may  proceed 
to  discuss  how,  through  insurance  directly  or  indirectly,  children, 
already  born  into  the  world,  may  be  brought  to  maturity  in 
healthy  and  vigorous  condition  and  then  be  maintained  alive  and 
in  such  condition  up  to  old  age. 

Even  here  life,  accident  and  sickness  insurance  on  the  lives 
of  their  progenitors  or  others  who  become  responsible  for  their 
support  and  care  may  be  of  great  importance ;  because  by  the  fail- 
ure of  such  a  life  or  by  its  invalidity,  the  education  and  care  and 
even  the  support  of  children,  both  so  essential  to  survival  and  to 
fitness  for  life,  may  be  endangered,  impaired  or  even  rendered 
wholly  inadequate.  Insurance,  therefore,  even  before  it  is  applied 
to  the  individual  human  being,  has  already  blessed  him,  in  fact 
in  case  the  need  has  arisen,  or  in  any  case  potentially,  through 
the  life,  accident  and  sickness  insurance  carried  by  persons  finan- 
cially responsible  for  his  support,  care  and  education. 

After  the  birth  of  the  individual  the  ways  in  which  his  lon- 
gevity may  be  increased  are  confined,  aside  from  moral  training, 
which  is  without  the  pale  of  the  discussion  here,  to  sanitation 
which  affects  his  surroundings,  to  hygiene  which  affects  the  care 
of  his  health,  and  to  treatment  or  means  of  cure  which  affects  his 
recuperation  in  event  he  is  stricken  with  disease. 

All  of  these  things  are  obviously  such  as  might  be  greatly  in- 
fluenced favorably  by  insurance.  It  must  be  borne  in  mind,  how- 
ever, that  it  is  not  fundamentally  the  business  of  insurance  to  in- 
fluence any  of  these  things  favorably  if  it  be  merely  a  promise  to 
pay  money,  or  even  to  provide  medical  service  and  medicines  as 
well  as  to  pay  money  in  event  of  disability,  or  a  promise  to  pay 
money  in  event  of  death.  The  business  of  the  insurance  company 
is  to  provide  these  benefits  in  consideration  of  premiums  paid  to 
it.  If  it  fixes  its  premiums  high  enough  to  cover  the  losses  and 
expenses  and  to  yield  a  profit,  it  has  conducted  its  business  just 
as  well  even  though  the  losses  should  be  large,  because  by  the 
hypothesis  the  premiums  were  also  correspondingly  large.  In 
other  words,  as  an  insurance  company  per  se,  it  is  not  in  the  least 
interested  w^hether  the  risks  are  great  or  small,  so  long  as  it  is  able 
to  gauge  the  risks  successfully  and  fix  premiums  which  will  yield 
a  profit.  These  things  are  merely  truisms  to  insurance  men,  but 
they  require  to  be  re-stated  at  this  time  in  order  both  that  the 
want  of  complete  adaptation  to  the  task  of  improving  the  lon- 
gevity of  a  people  and  the  very  considerable  amount  of  altruism 
involved  in  the  efforts  to  improve  longevity  which  these  compa- 
nies or  some  of  them  put  forth  may  be  fully  appreciated. 

The  things  which  have  been  done  by  some  of  the  insurance  com- 
panies in  the  United  States  toward  improving  sanitation,  care  of 
health  and  even  treatment  and  means  of  cure  are  by  no  means  in- 
considerable.    It  has  not  been  many  years  since,  for  instance,  the 


406       WORLD'S  INSURANCE  CONGRESS 

three  great  industrial  life  insurance  companies  reported  mortality 
in  excess  of  the  American  table,  this  being  due  to  the  heavy  mor- 
tality among  their  industrial  policyholders  who  are  literally  mil- 
lions in  numbers  and  embrace  all  ages.  When  it  is  said  that  the 
effect  of  this  heavy  mortality  among  the  industrial  policyholders 
put  the  total  mortality  higher  than  as  per  the  American  table, 
it  should  be  explained  that  this  was  even  more  significant  than 
these  words  may  appear  to  imply ;  for  in  the  first  place  all  of  these 
companies  had  a  large  "ordinar}'^"  business  among  select  lives  who 
were  insured  for  amounts  of  $1,000  or  more,  and  the  experience 
of  each  of  them  in  regard  to  this  business  was  as  favorable  as 
that  of  most  companies,  which  means  that  it  was  materially  lower 
than  the  American  table;  and,  in  the  second  place,  as  the  Ameri- 
can table  represented  a  mortality  nearly  if  not  quite  one-half 
larger  than  that  upon  well  selected  lives  under  good  sanitary  and 
hygienic  conditions,  it  follows  again  that  the  standard  applied  to 
the  aggregate  of  their  mortality  experience  was  much  higher  than 
experience  would  warrant. 

What  has  taken  place  in  the  last  ten  years  has  been  a  steady 
decline  in  the  ratio  of  the  aggregate  mortalitj'  in  these  compa- 
nies, including  both  industrial  and  ordinary  policyholders,  until 
in  each  case  it  is  well  within  the  American  table.  Nearly  all  of 
this  has  unquestionably  been  due  to  a  marked  reduction  in  the 
mortality  among  industrial  policyholders. 

Two  mortality  tables,  known  as  the  Standard  Industrial  and  the 
Substandard  Industrial,  have  been  prepared  by  one  of  these  com- 
panies from  data  collected  from  its  own  experience.  Neither  of 
these  exhibits  in  any  degree  the  favorable  results  of  the  more  re- 
cent mortality  experience,  for  both  of  them  show  mortality  very 
much  in  excess  of  the  experience  by  the  American  table.  It  is 
worthy  of  note,  likewise,  that  these  tables  are  so  graduated  as  to 
produce  higher  reserves  than  by  the  standard  tables  although  the 
usual  effect  of  heavy  mortality  at  the  younger  ages  is  to  increase 
the  premiums  but  reduce  the  reserves.  This  has  been  accomplished 
by  graduation,  which  causes  these  tables  to  exhibit  verj-  high  mor- 
tality, not  so  much  at  infantile  ages  and  in  middle  life,  but,  as  com- 
pared with  other  tables,  at  the  ages  40  to  70  inclusive.  If  they 
were  to  be  accepted  as  an  indication  of  the  actual  conditions  still 
obtaining,  all  that  has  been  said  in  the  foregoing  would  require  to 
be  obliterated. 

The  fact  is,  however,  that  a  great  improvement  in  mortality 
among  these  policyholders  has  taken  place.  It  is  by  no  means 
the  case  that  it  is  shared  entirely  by  the  smaller  companies  en- 
gaged in  the  industrial  life  insurance  business.  IMost  of  these 
accept  freely  negro  lives  and  perhaps  some  other  classes  of  lives 
which  are  either  excluded  or  at  least  not  favored  by  the  three  great 
companies,  and  in  any  event  they  usually  exhibit  materially 
heavier  mortality. 

The  first  cause,  then,  which  is  at  work  to  produce  lower  mor- 


WORLD'S  INSURANCE  CONGRESS  407 

tality  among  these  industrial  policyholders  is  careful  selection, 
which  is  a  cause  that  operates  not  to  bring  about  greater  longevity 
in  the  community  but  merely  to  obtain  for  them  as  policyholders 
those  of  the  community  whose  prospects  for  longevity  are  better 
than  others  of  their  class. 

There  are,  however,  at  least  two  other  things  which  these  compa- 
nies have  done  and  are  doing,  by  means  of  which  the  prospects 
for  longevity  of  those  who  have  become  their  policyholders  must 
be  very  considerably  enhanced.  One  of  these  is  the  constant  dis- 
semination of  literature,  simple,  to  the  point  and  attractively  pre- 
sented, which  describes  the  perils  of  bad  hygiene  and  of  failure 
to  obtain  promptly  medical  and  other  attention.  These  have  been 
distributed  by  the  tens  of  millions,  printed  in  every  language  which 
the  policyholders  of  these  companies  read.  Their  delivery  has  not 
been  entrusted  to  the  mails  but  has  been  made  one  of  the  duties 
of  the  collecting  agents  who  are  expected  to  call  for  premiums 
every  week.  In  consequence,  they  get  immediately  into  the  hands 
of  those  who  are,  or  should  be,  interested. 

The  second  great  thing  which  in  some  part  accounts  for  the 
improved  conditions,  is  the  introduction  of  free  visiting  nursing 
service.  This  has  so  far  been  confined  to  policyholders  residing 
in  certain  more  or  less  congested  districts  where  it  is  possible 
economically  to  arrange  for  the  employment  of  the  full  time  of 
nurses  or  to  make  arrangements  with  some  organization  of  nurses. 
The  character  of  those  whose  assistance  has  been  enlisted,  as  well 
as  all  the  reports  concerning  their  work,  attest  that  this  has  been 
no  child's  play  and  that  a  very  considerable  reduction  in  mortal- 
ity, especially  among  infants  and  women,  must  have  been  the 
result. 

It  is  not  possible  to  say  the  same,  so  far  as  I  am  advised,  about 
the  operations  of  the  industrial  health  companies.  Whether  there 
be  considered  the  dollar-a-month  industrial  health  business,  such 
as  have  obtained  a  strong  lodgment  in  the  North,  or  the  weekly 
premium  industrial  health  business  which  has  so  strong  a  hold 
upon  the  negroes  of  the  South,  in  both  cases  there  has  been  little 
or  no  attention  given  to  improving  the  conditions  as  regards  sani- 
tation, hygiene  or  means  of  cure  of  those  who  are  insured.  These 
companies  are  still  confining  themselves  to  the  collection  of  what 
they  believe  to  be  adequate  premiums  to  cover  their  expenses  and 
losses  and  yield  a  profit. 

There  is  one  great  difficulty  about  an  insurance  company  which 
is  interested  in  not  having  to  pay  a  claim,  obtaining  or  perhaps 
even  attempting  to  obtain  the  confidence  of  policyholders,  wli'fh 
should  here  be  mentioned.  It  is  that  one  of  the  most  obvious  wrys 
of  reducing  the  death  rate  in  an  insurance  company  is  by  some 
means  to  get  rid  of  the  life  just  before  it  fails.  This,  for  instance, 
in  industrial  insurance  could  conceivably  be  accomplished — and 
it  has  been  accomplished  in  the  cases  of  certain  vile  concerns  be- 
yond a  question — by  the  agent  failing  to  call  for  the  premium  until 


408       WORLD'S  INSURANCE  CONGRESS 

the  time  within  which  it  could  be  paid  has  elapsed  and  the  com- 
pany then  refusing  to  accept  it.  It  must  be  remembered  that 
while  the  custom  is  for  the  agent  to  call  for  premiums,  the  com- 
pany is  under  no  obligation  to  have  him  do  so.  This  applies  both 
to  industrial  life  and  to  industrial  health,  and  indeed  to  all  forms 
of  life  insurance  and  health  insurance  business. 

It  requires  a  peculiarly  broadminded  management  to  appreciate 
that  it  is  far  better  not  to  attempt  to  save  money  that  way ;  and 
one  of  the  difficulties  which  a  company  that  is  so  fortunate  as  to 
have  such  management  is  certain  to  encounter  w^hen  it  endeavors 
to  take  part  in  the  rehabilitation  of  health  or  the  saving  of  life, 
is  that  it  may  be  met  with  a  suspicion  that  its  purpose  in  even 
entering  into  the  matter  is  to  get  itself  in  position  as  soon  as  prac- 
ticable to  get  rid  of  the  policy,  if  the  life  be  found  to  be  impaired. 

In  the  last  five  years  there  may  perhaps  have  been  something 
done  in  the  United  States  toward  improving  the  chances  for  lon- 
gevity of  some  of  the  working  people  by  means  of  group  insurance. 
Under  group  insurance  policies  the  companies  cover,  for  instance, 
all  the  employees  of  a  given  employer.  They  do  not  have  the  option 
of  excluding  some  and  accepting  others.  Consequently  they  can- 
not gain  by  attempting  to  eliminate  those  who  are  not  likely  to 
live  long.  Although  it  is  still  true  that  it  is  their  business  merely 
to  correctly  gauge  the  risk  and  to  charge  the  right  premium  there- 
for, it  is  likewise  true  that  they  can  have  a  temporary  advantage 
and  perhaps  even  a  permanent  advantage  by  reducing  the  mortal- 
ity in  the  group — certainlj^  a  temporary  advantage  because  the 
premiums  are  fixed  for  at  least  a  year  and  sometimes  for  five 
years,  and  possibly  a  permanent  advantage  if  the  employer  does 
not  require  them  to  make  it  good  to  him  either  in  participation 
or  by  reduction  of  subsequent  premiums.  In  any  event,  there  is 
a  very  considerable  incentive  for  the  companies  undertaking  to 
encourage  sanitation,  hygiene  and  means  of  cure,  and  undoubt- 
edly a  good  deal  of  progress  has  been  made  in  this  direction  with 
the  active  cooperation  both  of  employer  and  of  employees. 

Another  form  of  insurance  which  is  carried  on  by  the  employer 
cooperating  with  his  employees  is  known  as  "mutual  aid"  or  "re- 
lief" insurance.  This  usually  provides  not  merely  for  the  pay- 
ment of  cash  benefits  but  also  for  the  supplying  in  part  or  in  whole 
of  medical  attention,  necessary  medicines,  etc. ;  and  it  often  ex- 
tends to  supervising  or  at  least  to  encouraging  sanitation,  hygiene 
and  means  of  cure,  always  as  regards  the  individual  workmen  and 
not  infrequently  also  as  regards  their  families.  This  form  of  in- 
surance is  es.sentia.lly  social  insurance,  especially  where  the  em- 
ployer either  requires  all  his  employees  to  be  participants  in  it  or 
favors  their  doing  so  by  giving  the  preference,  in  taking  on  or  lay- 
ing ofif  employees,  to  those  who  are  insured  in  the  fund.  In  such 
case  it  runs  not  as  a  plan  merely  for  providing  cash  benefits,  but 
also  and  very  particularly  as  a  comprehensive  plan,  carried  for- 
ward by  cooperative  effort,  for  improving  the  social  and  economic 


WORLD'S  INSURANCE  CONGRESS  409 

conditions,  including  very  particularly  the  health  and  prospects 
for  a  long  life,  of  the  employees. 

These  things,  which  have  so  far  been  discussed  and  which  are 
all  that  has  been  accomplished  ajid  perhaps  not  very  far  from 
all  that  could  be  accomplished  by  insurance  companies  and  volun- 
tary' insurance,  are,  of  course,  as  nothing  compared  with  a  State 
or  National  system  of  social  insurance  which  would,  if  reasonable, 
completely  provide,  as  in  Germany,  Great  Britain  and  several 
other  countries  of  Europe,  for  the  care  of  wage-earners  and  per- 
haps of  all  the  members  of  their  families  during  sickness,  with 
a  cash  benefit  in  event  of  the  sickness  of  the  wage-earner  so  that 
his  family  may  be  supported,  and  also  provide  for  the  maintenance 
of  the  widow,  children  during  their  helpless  minority,  and  other 
dependents  in  event  of  the  death  of  the  wage-earner.  Such  a  sys- 
tem, operating  on  a  plan  that  calls  for  the  employees,  their  em- 
ployers and  the  State,  all  three  being  contributors  to  the  funds, 
taking  part  in  the  management,  is  particularly  well  adapted  in 
every'  regard  for  bringing  about  improvements  in  sanitation,  in 
hygiene  and  in  medical  conditions,  all  of  which  tend  to  bring  a 
larger  number  of  children  up  to  the  age  beyond  which  they  may 
be  expected  to  contribute  more  to  society  than  they  consume,  and 
to  maintain  them  alive  for  a  longer  average  period  after  attain- 
ing that  age.  It  is  the  experience,  where  such  systems  are  in  use, 
that  there  is  a  tremendous  amount  of  interest  taken  in  ascertain- 
ing as  accurately  as  possible  what  the  causes  are  which  are  oper- 
ating to  deprive  children  and  men  and  women  in  youth  or  the 
prime  of  life  of  their  lives,  and  the  very  first  prerequisite  to  deal 
with  these  causes  is  obviously  to  ascertain  that  they  are  operating 
and  to  what  extent.  Concerning  this  we  now  have  very  scanty 
data,  and  the  information  also  does  not  come  to  us  with  the  force 
which  it  would  have  come,  were  this  waste  of  human  life  to  be 
translated  in  part  into  dollars  and  collected  in  contributions  to  in- 
surance benefits,  medical  care,  etc.,  from  all  concerned. 

It  is  not  mere  theory  either  that  such  will  be  the  result.  Dr. 
Zacher,  who  furnishes  the  figures  already  quoted  concerning  the 
increase  of  longevity  in  Germany  between  the  year  1870  and  the 
year  1900,  which  amounts  to  nearly  if  not  quite  doubling  the 
effective  energy  of  the  German  people  per  person  born,  is  entirely 
clear  that,  while  other  forces  have  been  at  work,  much  the  larger 
part  of  this  wonderful  record  is  due  to  the  presence  and  activity 
of  social  insurance,  which,  since  it  has  no  avenue  of  escape  from 
paying  the  benefits  in  event  of  death  or  sickness  and  has  no  profit 
in  sight  to  cause  it  to  fail  to  consider  the  burden  which  is  being 
imposed,  necessarily  directs  its  attention  in  large  part  and  as  one 
of  it  sprime  objects  toward  the  elimination  of  the  causes  of  early 
deaths.  It  is  not  reasonable  to  expect  that  we  will  in  any  way 
duplicate  this  experience  without  making  use  of  the  same  system, 
which  has  now  been  thoroughly  tried  out  for  more  than  thirty 
years. 


410  WORLD'S  INSURANCE  CONGRESS 

The  ideals  which  should,  in  my  opinion,  be  before  us  are: 
Primarily,  to  bring  as  many  of  the  children  born  to  maturity  as 

possible  and  then  to  maintain  as  many  in  life  and  vigor  to,  say 

age  70,  as  possible — all  the  children  born  to  age  70  if,  or  when, 

that  shall  be  possible. 

Through  relief  by  insurance,  afforded  as  a  public  matter,  com- 

pulsorily  and  at  the  lowest  cost,  covering : 

1.  Medical  care,  nursing,  medicines,  and  the  like  for  all  sick- 
nesses or  other  disabilities,  including  confinement. 

2.  Compensation  for  loss  of  time  during  all  disabilities. 

3.  Benefits  in  the  form  of  annuities  to  widows,  orphans  and 
other  dependents. 


ACCEPTANCE  OF  MEDAL 

Safety  Work  of  Insurance  Companies 

By  Charles  H,  Holland 
General  Manager,  Royal  Indemnity  Company 

Mr,  Chairman,  Mr.  Done,  Ladies  and  Gentlemen: 

It  is  more  than  a  great  personal  pleasure  to  me  to  receive  from 
the  Exposition  this  beautiful  JNledal — it  is  a  signal  honor,  because 
this  is  the  first  time  in  history  that  casualty  insurance  companies 
have  ever  been  so  recognized ;  and  on  behalf  of  the  liability  insur- 
ance companies  of  the  country,  I  wish  to  express  our  keenest  appre- 
ciation of  this  recognition  which  the  Exposition  authorities  have 
accorded  to  us. 

It  has  been  suggested  that  it  might  be  of  interest  to  you  if  I 
were  to  explain  very  briefly  some  of  the  accident  prevention  Avork 
that  is  undertaken  by  the  casualty  insurance  companies;  and  per- 
haps before  I  attempt  to  do  that  I  should  try  to  explain  in  a  few 
W'Ords  what  Casualty  Insurance  is,  because  an  intelligent  under- 
standing of  the  insurance  business  generally  is  all  too  uncommon. 
Casualty  insurance,  then,  has  as  its  fundamental  principle  the 
provision  of  means  for  the  reimbursement  of  the  money  loss  oc- 
casioned to  an  individual  when  he  is  disabled  by  accidental  in- 
juries. It  may  be  surprising  to  you  to  know  that  in  the  United 
States  of  America  there  occur  every  year  more  than  one  million 
accidents  which  disable  men  from  work;  and  it  was  the  study  of 
these  ever-growing  figures,  representing  an  important  phase  of  the 
daily  tragedies  in  human  life,  that  caused  certain  casualty  insur- 
ance men  to  start  individual  investigations  as  to  how  this  great 
economic  M-aste  with  its  necessary  accompaniment  of  suffering 
could  be  restricted. 

You  will  realize  that  an  economic  waste  is  involved,  for.  in  tlie 
first  place,  the  individual  who  is  injui'cd  loses  his  earning  powec 


WORLD'S  INSURANCE  CONGRESS  411 

and  ceases  for  the  period  of  his  disability  to  bear  his  part  of  the 
productive  activities  of  the  world.  In  the  second  place,  those 
around  him  lose  time  as  a  direct  result  of  his  accident.  I  venture 
to  say  that  if  an  accident  were  to  occur  in  this  Exposition  at  the 
present  moment,  within  a  very  few  minutes  there  would  be  many 
thousands  of  people  gathered  around  the  spot,  in  actual  fact  wast- 
ing time;  and  so  in  an  industrial  plant  when  a  man  is  injured  there 
is  a  natural  impulsive  cessation  of  work  in  his  vicinity,  and  if  the 
injuries  are  important  there  may  be  discernible  during  the  rest 
of  the  day  a  feeling  of  upset  and  disturbance  directly  traceable 
to  the  accident.  So,  not  only  the  injured  man  but  also  those 
around  him  suffer  this  economic  waste;  and  indeed  the  world  suf- 
fers in  an  intangible  way  by  reason  of  the  injured  man's  loss  of 
vitality,  suffering,  pain  and  resultant  misery. 

The  investigation  thus  started  by  some  of  the  casualty  insurance 
people  disclosed  the  startling  fact  that  the  great  majority  of  acci- 
dents are  avoidable.  They  ought  not  to  occur;  and  the  very  cir- 
cumstances of  their  occurrence  should  indicate  the  protective  means 
whereby  their  recurrence  may  be  avoided.  And  so  it  came  about 
that  these  casualty  insurance  people,  still  working  individually, 
began  to  encourage  safeguard  work.  They  started  the  inspection 
of  the  plants  they  insured,  and  recommended  to  employers  the  in- 
stallation of  safety  appliances.  One  of  them  would  say  to  an  em- 
ployer, "I  don't  like  the  look  of  that  machine,  but  its  danger  points 
can  be  enclosed;  why  not  put  a  safeguard  around  it?"  The  em- 
ployer would  nearly  always  comply,  and  a  great  deal  of  very  useful 
work  was  accomplished  in  this  unorganized  way.  But  a  difficulty 
arose  because  there  was  no  coordination  in  this  work  between  the 
casualty  insurance  companies.  They  worked  as  individuals,  with- 
out any  cooperation ;  and  what  one  company  would  consider  a  dan- 
gerous machine  might  be  regarded  differently  by  another.  And 
there  is  no  reason  why  I  should  not  be  perfectly  frank  and  tell 
you  that  some  years  back  this  "safety  work,"  which  was  in  its 
inception,  was  considerably  hampered  by  competition — the  com- 
petition for  business  between  the  companies ;  for  if  in  its  desire 
for  business  one  company  told  an  employer  that  no  expense  need 
be  incurred  by  him  in  providing  safeguards,  a  competing  com- 
pany which  had  recommended  the  installation  of  safety  devices 
might  expect  to  lose  the  business.  It  is  only  within  recent  years 
that  the  companies  have  attempted  to  cooperate  in  this  matter  and 
bring  together  all  their  experience,  all  their  facts,  all  their  data, 
through  the  medium  of  the  National  Workmen 's  Compensation  Ser- 
vice Bureau  to  which  this  handsome  medal  has  been  awarded,  for 
the  purpose  of  directly  lessening  the  dreadful  toll  of  life  and  limb 
which  is  involved  in  the  present  day  high  pressure  of  industrial 
activity. 

The  membership  of  the  National  Workmen's  Compensation  Ser- 
vice Bureau  consists  of  practically  every  leading  casualty  insur- 
ance company  in  the  country,  and  its  plan  of  operations  took  this 


412  WORLD'S  INSURANCE  CONGRESS 

form:  The  Bureau  would  investigate,  through  a  corps  of  compe- 
tent engineers  whom  it  employs  for  the  purpose,  one  of  the  lead- 
ing industries,  say,  for  example,  the  wood-working  industry.  Those 
engineers  make  a  very  thorough  examination  of  that  industry  from 
the  aspect  of  accident  prevention.  They  examine  every  machine 
used  in  a  wood-working  plant.  They  watch  the  operations  from 
every  angle.  They  make  exhaustive  tests.  They  make  a  special 
study  of  each  machine  with  a  view  to  discovering  by  what  means 
an  accident  might  possibly  occur  in  its  use.  And,  having  made 
those  tests,  having  found  the  danger  points  in  the  machines,  they 
set  about  devising  safeguards;  and  when  these  have  been  exhaus- 
tively tested  the  Bureau  publishes  a  volume  called  "Safety  Stan- 
dards for  the  Wood- Working  Industry"  which  contains  plans  and 
specifications  of  the  guards  we  recommend. 

Similar  inspections,  resulting  in  similar  safety  standard  books, 
have  been  directed  at  other  leading  industries. 

And  I  would  like  to  mention  at  this  point  that  in  the  exhibit 
of  the  National  Workmen's  Compensation  Service  Bureau,  in  the 
Palace  of  Mines,  you  will  find  a  large  number  of  our  engineers' 
original  sketches,  showing  the  danger  points  in  various  machines 
and  the  way  in  which  the  danger  can  be  removed.  I  hope  that 
you  will  all  be  sufficiently  interested  to  visit  that  exhibit. 

Now,  the  insurance  companies,  armed  with  this  book,  go  to  an 
employer  and  say:  "Mr.  Wood-worker,  the  rate  for  your  work- 
men's compensation  insurance,  covering  your  plant  as  it  is,  is,  say, 
$5.00  per  cent,  but  we  have  sent  an  inspector  through  your  plant, 
and  the  inspector  finds  that  you  have  an  unguarded  saw  which  is 
likely  at  any  moment  to  cause  a  man  to  lose  a  hand  or  a  finger.  If 
you  will  guard  that  saw,  and  we  will  show  you  an  inexpensive 
method,  we  will  deduct  so  many  cents  from  that  $5.00  rate.  And 
you  have  an  unguarded  planing  machine  here ;  guard  that  machine 
and  there  will  be  a  further  reduction. 

"But  there  are  some  danger  points  in  your  plant  which  we  con- 
sider inexcusable — for  example,  this  exposed  set  screw.  We  will 
not  give  you  a  reduction  for  covering  that  set  screw,  but  we  shall 
increase  your  rate  if  you  do  not  cover  it." 

So  you  will  see  that  the  original  premium  will  be  increased  or 
decreased  according  to  the  willingness  of  the  employer  to  make  his 
plant  a  safe  working  place. 

After  having  gone  through  the  mechanical  hazard  of  a  plant, 
we  then  examine  it  from  another  viewpoint.  We  say:  "We  will 
still  further  reduce  your  rate  if  you  will  put  into  your  plant  a 
First  Aid  Equipment,  which  will  cost  you  only  a  few  dollars  and 
which  takes  up  practically  no  room,  but  which  means  that  if  a  man 
cuts  his  finger  he  will  go  to  the  First  Aid  Cabinet  and  have  the 
cut  cleaned  and  bandaged,  instead  of  the  old  method  of  wrapping 
a  piece  of  dirty  rag  around  it,  thus  involving  the  danger  of  in- 
fection and  blood  poisoning  with  its  probable  result  of  the  loss  of 
his  hand." 


WORLD'S  INSURANCE  CONGRESS  413 

Then  we  look  around  the  plant  seeking  still  more  simple  de- 
fects, such  as  lack  of  sufficient  light,  loose  floor  boards,  greasy- 
floors,  unguarded  stairways,  etc.  And  so,  we  go  through  the  em- 
ployer's entire  operations,  making  recommendations  to  him  which 
will,  if  complied  with,  at  least  help  to  eliminate  avoidable  acci- 
dents. That  employer's  premium  rate  may  by  this  time  be  brought 
down  from  $5.00  per  cent  to  perhaps  $3.50,  or  it  may  on  the  other 
hand,  if  the  plant  is  in  a  bad  condition,  be  raised  from  $5.00  to 
$7.00  or  more. 

That,  Ladies  and  Gentlemen,  is  very  briefly  the  plan  we  are  fol- 
lowing; and  perhaps  you  would  like  to  know  what  the  employer 
thinks  of  it.  I  am  very  glad  to  be  able  to  say  that  employers 
generally^  have  given  our  work  a  spontaneous  welcome.  We  have 
found  employers  to  be  extremely  human ;  they  are  not  only  willing 
to  expend  their  money  for  safeguards,  but  we  have  found  that 
they  really  are  keenly  anxious  about  the  safety  of  their  employees. 

It  has  of  course  been  our  aim  to  make  every  safeguard  we  rec- 
ommend as  inexpensive  as  possible.  Let  me  give  you  an  example. 
Perhaps  one  of  the  most  fruitful  causes  of  injury  is  an  unguarded 
fly-wheel.  Now  a  fly-wheel  when  stationary  looks  anything  but 
dangerous;  it  is  smooth,  probably  polished,  it  has  no  cogs  nor 
teeth  nor  sharp  edges.  But  when  that  fly-wheel  revolves  it  becomes 
a  veritable  trap  for  the  unwary;  and  we  shall  never  know  how 
many  hundreds  of  lives  have  been  lost  and  how  many  thousands 
of  people  have  been  injured  by  their  clothing  having  been  caught 
in  revolving  wheels.  You  can,  however,  protect  a  fly-wheel,  and 
protect  it  completely,  by  erecting  a  simple  inexpensive  railing 
around  it,  or  by  enclosing  it  within  a  -wire  screen.  An  expenditure 
of  perhaps  $10.00  would  protect  any  ordinary  fly-wheel;  and,  so, 
every  safeguard  that  we  recommend  will  pay  for  itself  within  a 
very  short  time  by  the  reduction  in  rate  which  it  earns. 

I  have  said  that  this  is  the  first  occasion  upon  which  casualty 
insurance  companies  have  been  thus  signally  honored,  and  I  can 
assure  you  we  are  gi-atified  by  this  commendation  of  our  work. 
We  shall  ahvays  be  pleased  that  w^e  had  the  opportunity  of  mak- 
ing our  work  more  generally  known  hy  means  of  an  exhibit  in  this 
great  Exposition.  I  ask  you  to  believe  that  the  managers  of  casu- 
alty insurance  companies  are  not  undertaking  this  extensive  safety 
campaign  purely  as  a  business  proposition.  It  is,  of  course,  good 
for  our  business;  but  apart  from  the  fact  that  we  naturally  wish 
to  eliminate  unnecessary  claims,  we,  too,  are  human,  and  we  re- 
joice that  we  can  aid  in  rendering  more  safe  the  places  in  which 
our  fellowmen  must  do  their  daily  work.  Our  slogan  is  that 
''Compensation  for  an  accident  is  only  an  apologj^  while  the 
prevention  of  an  accident  is  a  beneficence." 

Ladies  and  Gentlemen,  we  are  deeply  grateful  for  this  medal; 
we  shall  value  it  and  look  upon  it  with  pride  in  our  central  offices 
in  New  York.  And,  while  we  know  that  the  credit  for  this  great 
Exposition,  this  wonderland  of  beauty,  is  due  chiefly  to  the  State 


414       WORLD'S  INSURANCE  CONGRESS 

of  California  and  in  a  very  large  measure  to  this  remarkable 
City  of  San  Francisco,  we  know  also  that  it  is  in  fact  a  World's 
Exposition;  and  so  we  hope  and  believe  that  while  the  Exposition 
authorities  thus  express  officially  their  endorsement  of  our  acci- 
dent prevention  work,  we  may  take  that  endorsement  as  an  indica- 
tion that  we  are  engaged  in  an  undertaking  that  is  earning  world- 
wide approval. 


THE  SAFETY  WORK  OF  RAILROADS 

By  L.  E,  Abbott 
General  Claim  Agent,  Oregon  Short  Line  Railroad 

Safety  First  is  a  Twentieth  Century  doctrine  which  concerns 
the  human  welfare.  It  is  an  application  of  psychological  truths 
which  has  been  rung  out  of  merciless  experience  for  centuries.  It 
is,  therefore,  a  plan  which,  if  applied  honestly  and  fearlessly,  will 
solve  the  perplexing  problem  of  to-day.  It  is  truth  not  restrained 
by  creeds  or  isms.  In  it  is  the  spirit  which  maketh  alive  without  the 
letter  which  killeth.  To  me  its  principles  are  infallibly  true.  It 
will  bring  to  our  great  industrial  armies  to-day  that  which  money 
cannot  buy — contentment.  It  is  our  industrial  gospel.  It  leavens 
the  loaf  of  humanity.  It  will  raise  our  industrial  world  to  the 
highest  plane,  which  spells  homes,  happiness,  humanity  for  all. 
History  shows  that  all  reformations  were  but  the  outburst  of  hu- 
man thought  which  had  been  accumulated  on  account  of  human 
doings  inconsistent  with  progressive  thought.  Thus  the  epochs  of 
the  world  are  known.  And,  without  appearing  to  be  prophetic,  1 
want  to  say  that  Safety  First  emphasizes  an  important  point  in 
our  history  from  which  succeeding  years  will  be  counted.  I  have 
already  observed  extraordinary  events  upon  which  can  be  predi- 
cated far-reaching  results. 

Ever}^  age,  with  its  new  conditions,  has  developed  "the  man 
of  the  hour."  The  man  of  to-day  is  he  who  has  come  up  through 
the  rank  and  file,  who  has  been  in  a  position  to  keep  and  has  kept 
his  ear  to  the  ground,  who  has  been  able  to  analyze  the  common 
current  thought  which  makes  public  sentiment,  the  strongest  and 
most  impelling  power  to  action  in  our  Republic  to-day.  His  task 
is  to  harmonize  the  differences  which  seem  to  stand  in  the  way  of 
progress.  So,  when  the  gospel  began  to  take  unto  itself  an  or- 
ganization by  which  its  principles  could  be  carried  back  to  the 
people  to  be  sent  through  the  refining  process  of  common  current 
thought,  it  was  hailed  with  great  approval  by  the  students  of  soci- 
ology. We  behold  now  with  great  approval  a  tangible  humanita- 
rian gospel  which  has  been  worked  out  of  conflicting  imagination. 
For  the  last  twenty-five  years  we  have  not  had  peace,  harmony 
and    contentment   in   the   industrial    world   necessary  to  healthy 


WORLD'S  INSURANCE  CONGRESS       415 

growth.  It  could  be  well  likened  unto  a  volcano.  We  have  heard 
the  rumblings  from  within,  but  relying  on  our  people  to  work  out 
their  own  destiny,  have  looked  forward  to  the  time  when  the  undi- 
rected forces  within  which  were  causing  the  ominous  sound,  would, 
like  the  roaring  waters  of  the  Niagara,  be  encompassed  and  di- 
rected to  the  needs  and  comfort  of  civilization. 

I  am  not  prepared  to  say  whether  the  men  who  control  the  great 
railroads  of  the  country  were  first  to  recognize  the  good  in  this 
new  gospel  or  not,  but  I  am  prepared  to  say  that  from  them  came 
the  first  great  concerted  effort  to  give  it  opportunity  to  speak  for 
itself.  Right  at  the  outset  railroad  companies  gave  to  this  cause 
liberally  by  way  of  investigation  and  application.  They  were  soon 
convinced  that  it  was  a  thing  needed.  Organizations  were  formed 
from  one  end  of  our  land  to  the  other.  These  organizations  pro- 
vided for  committees  to  be  composed  of  every  class  of  labor,  from 
the  section  men  in  the  desert  to  the  general  manager,  to  meet 
monthly  and  discuss  the  physical  conditions  on  the  roads  of  our 
great  country  in  the  hope  that  we  could  obtain  physical  perfection. 
I  want  to  tell  you  that  I  have  been  through  this  organization  from 
the  humble  group  of  men  on  the  line,  who  were  discussing  the 
advisability  of  having  whistles  shrill  enough  to  reach  beyond  the 
range  of  the  human  voice  to  warn  the  foreigner  of  danger,  to 
the  gatherings  of  the  general  officers,  and  further  I  want  to  say 
that  I  have  felt  that  same  humanitarian  spirit  all  along  the  line. 
Nothing  has  been  curtailed  by  conventionalism  for  greed.  There 
has  not  been  one  part  of  the  railroad  from  the  dating  nails  in  a 
tie  to  the  depot  but  what  has  been  discussed  and  changed  for  the 
safety  and  welfare  of  the  employees  and  the  traveling  public. 
Here  let  me  explain  for  fear  you  may  think  I  am  exceeding  the 
bounds  of  the  subject  upon  which  I  am  to  talk,  namely,  "Protec- 
tion of  the  Traveling  Public."  We  have  learned  that  the  only 
true  safety  to  the  travelers  lies  in  safe  men  who  handle  them,  and 
that  safe  men  are  developed  and  kept  safe  only  through  the  true 
spirit  of  cooperation. 

'We  have  changed  the  location  of  all  mail  cranes,  giving  greater 
clearance;  installed  lights  on  derails;  have  acted  upon  numerous 
suggestions  of  employees  and  citizens  relative  to  crowded  plat- 
forms; obliterated  paths  to  change  direction  of  employees  and 
pedestrians  in  crossing  tracks  at  dangerous  places;  have  estab- 
lished regular  departments  for  the  inspection  of  tools  and  appli- 
ances; changed  the  manner  of  and  increased  the  vigilance  con- 
nected with  dropping  cars  from  coal  chutes;  have  adopted  numer- 
ous devices  and  methods  to  prevent  injuries  from  flying  rivets ;  at 
a  great  expense  have  installed  modern  skylights  in  shops  with 
netting  under  them  to  prevent  glass  from  falling  on  the  work- 
men ;  have  changed  nearly  every  part  of  a  locomotive,  particularly 
those  that  our  records  show  had  figured  in  an  accident,  such  as 
squirt  hose,  grab  irons,  hand  rails  on  back  of  engines,  shaker  bars, 
hooks  on  ash  pans,  shields  in  gangways  of  engines,  water  glasses; 


416       WORLD'S  INSURANCE  CONGRESS 

installed  double  glass  for  front  windows  of  engine  cabs;  changed 
the  steam  connections  in  engine  cabs;  changed  hand  holds  near 
running  boards  of  engines ;  changed  steps  on  certain  class  engines ; 
installed  safer  coal  gates;  have  investigated  extensively  and 
adopted  numerous  suggestions  to  prevent  soot  escaping  from  en- 
gines and  flying  on  passengers;  equipped  engines  with  water  pails 
solely  in  the  interest  of  Safety  First.  We  have  established  the 
electric  block  signal  system  on  nearly  every  foot  of  our  road.  We 
have  moved  water  tanks  from  nearby  platforms  to  do  away  with 
the  ice  caused  by  tanks  leaking  in  the  winter  time,  causing  injury 
to  passengers  and  public.  We  have  removed  every  high  platform 
on  our  road,  and  have  done  away  now  with  the  possibility  of  pas- 
sengers falling  between  train  and  platform  while  getting  on  or 
off  train.  We  have  doubled  our  energy  on  the  signal  tests.  We 
have  compelled  hotel  employees  to  keep  their  push  carts  off  plat- 
form when  trains  are  coming  in.  We  have  changed  the  location 
of  home  block  signals  where  the  signal  was  established  on  the  sta- 
tion side  and  caused  a  hazard  of  people  running  against  it  when 
getting  off  trains,  and  in  such  instances  they  have  been  moved  to 
the  opposite  side  of  the  track.  Derail  switches  have  been  lighted 
and  derails  have  been  installed  on  all  sides  adjacent  the  main 
line.  Many  open  bridges  have  been  widened  and  covered.  Strict 
regulations  have  been  established  for  making  up  trains  in  yards  to 
prevent  the  old  time  annoyance  and  injuries  to  passengers  while 
being  switched  at  terminal  yard.  Air-line  boxes  or  gas  boxes  pro- 
truding above  the  ground  near  stations  have  been  lowered  and  the 
stumbling  blocks  done  away  with.  A  campaign  of  education  has 
commenced  with  the  view  of  keeping  stockmen  from  jumping  on 
or  off  moving  trains.  Ice  from  around  water  tanks  where  it  is  nec- 
essary for  passengers  to  travel  has  been  picked  up  and  wheeled 
away  until  the  time  when  the  tank  could  be  removed.  A  construc- 
tion company  had  its  powder  house  established  within  several  hun- 
dred feet  of  a  track.  It  was  moved  to  prevent  the  extra  hazard 
to  passengers  while  on  our  train.  Work  has  been  taken  up  with 
the  passengers,  pleading  with  them  not  to  place  heavy  packages  in 
the  hat  racks  in  coaches.  Many  serious  and  permanent  injuries 
have  resulted  from  this  practice.  One  of  the  most  gigantic  tasks  un- 
dertaken, which  is  now  almost  completed,  was  to  establish  a  safe 
clearance  between  the  tracks  and  all  buildings  and  power  poles  and 
structures  along  our  line.  It  is  surprising  to  note  the  hearty  co- 
operation of  the  merchants  and  industries  along  our  line.  This 
has  cost  great  sums  of  money  but  has  resulted  in  a  great  reduction 
of  fatal  injuries  to  our  own  employees,  which  ultimately  is  one 
of  the  greatest  protections  to  the  traveling  public.  Bulletins  have 
been  posted  in  our  Railroad  Y.  M.  C.  A.  institutions  to  call  the  at- 
tention of  the  employees  as  well  as  the  public  to  dangerous  things 
and  practices.  Suggestions  from  men  and  the  passengers  travel- 
ing on  our  line  have  resulted  in  better  lighting  facilities  at  small 
depots.    By  persistent  effort  in  reporting  and  repairing  and  chang- 


WORLD'S  INSURANCE  CONGRESS  417 

ing  models  of  passenger  car  windows  we  have  almost  eliminated 
the  old  time  common  accident  resulting  from  windows  dropping 
onto  passengers'  hands  and  arms.  Time  cards  have  been  covered 
with  glass,  this  in  order  to  do  away  with  the  danger  of  misreading 
dirty  or  defaced  figures  at  terminal,  which  has  sometimes  resulted 
in  collisions.  The  question  of  whistling  signals  to  section  foremen 
for  their  protection  and  also  for  the  purpose  of  watching  passing 
passenger  trains  to  note  if  any  equipment  is  dragging,  has  been 
discussed  and  now  acted  upon  in  such  a  way  that  great  good  is 
our  reward.  Deckings,  hand  railings  for  small  bridges  along  the 
entire  line  have  been  installed.  The  practice  of  letting  passengers 
off  between  tracks  has  also  been  stopped.  The  slightest  wear  in 
viaduct  steps  leading  to  our  depots  has  been  reported  by  some 
Safety  First  employee  and  repaired  immediately.  Glass  doors  in 
the  place  of  wooden  doors  have  been  established  in  some  small  de- 
pots to  avoid  the  danger  of  common  door  accidents  due  to  passen- 
gers coming  out  at  about  the  same  time  another  passenger  is  going 
in.  The  Safety  First  motto  has  been  placed  on  every  train  order. 
Safety  suggestions  have  pointed  out  the  danger  incident  to  train- 
men's lanterns  going  out.  Extended  investigations  and  extensive 
analysis  of  the  oils  have  been  the  result,  and  will  eventually  result 
in  the  adoption  of  an  electric  lantern.  First  Aid  medical  boxes 
have  been  placed  on  every  train.  We  also  now  have  access  to  mod- 
ern hospitals  at  places  of  easy  access  from  all  points  on  our  line. 
A  great  many  crossing  bells  have  been  installed.  The  danger  inci- 
dent to  hanging  household  articles  on  the  track  side  of  outfit  cars 
has  been  stopped.  Old  working  places  have  been  changed  and  new 
ones  built  with  the  view  of  furnishing  proper  light,  heat,  ventila- 
tion and  sanitation  for  our  workmen.  Also  the  shops  and  machin- 
ery have  had  a  thorough  overhauling,  which  has  resulted  in  mod- 
ern protection  to  all  machinery,  such  as  guards  for  gears  on  lathes 
and  pulleys  and  driving  wheels,  drill  presses,  sharpeners,  conduit 
wires  of  machines,  grindstones,  sprocket  wheel  chains,  emery 
wheels,  old  wooden  horses  replaced  with  new  steel  ones,  pits  have 
been  covered,  mill  roofs  made  new  and  shields  for  band  saws  in- 
stalled. In  every  station  on  the  Oregon  Short  Line  Railroad  a 
bubbling  fountain  has  been  installed  from  which  our  patrons  as 
well  as  our  employees  can  obtain  drinking  water  as  pure  as  nature 
furnishes  it  to  us.  All  drinking  water  along  our  line  has  been 
analyzed  and  in  places  where  it  has  been  found  to  be  impure 
notice  to  that  effect  has  been  posted.  So  you  will  observe  our 
three  years'  work,  which  has  dealt  almost  exclusively  with  physical 
conditions,  has  only  been  an  object  lesson,  but  in  our  class  asso- 
ciation we  have  come  to  know  each  other  better;  we  have  realized 
that  there  are  more  misunderstandings  than  real  grievances,  and 
we  have  commenced  to  realize  the  only  true  way  to  settle  our  dif- 
ferences. 

I  could  fill  a  small  volume  just  in  naming  the  subjects  that  have 
been  offered  in  the  interest  of  Safety  First  in  our  three  years' 


418  WORLD'S  INSURANCE  CONGRESS 

■work.  This  has  resulted  in  physical  conditions  but  a  little  short  of 
perfect.  In  fact,  our  roadbed  from  one  end  to  the  other  has  been 
pronounced  "as  near  perfect  as  possible"  by  competent  railroad 
officials  from  other  lines.  This  has  already  resulted  in  the  fol- 
lowing statistics : 

Fiscal  Year    Fiscal  Year     Fiscal  Year 

Ending  June  Ending  June  Ending  June 

30th,  1913       30th,  1914       30th,  1915 

Number  of  employees 
killed     18  17  12 

Number  of  employees  in- 
jured             2,716  1,539  1,425 

Number      of      passengers 

killed    0  1  0 

Number  of  passengers  in- 
jured      62  49  94* 

Number      of      passengers 

killed  in  train  accidents  0  0  0 

Number  of  outsiders  killed  16  22  18 

Number  of  outsiders  in- 
jured    51  72  73 

Mileage  of  road  2,252.91. 

During  the  last  ten  years  the  Oregon  Short  Line  Railroad  Com- 
pany has  carried  21,332,683  passengers  an  average  distance  of 
85  miles  each.  This  is  equal  to  carrying  1,813,295,055  passengers 
one  mile,  or  one  passenger  1,813,295,055  miles,  a  distance  equal  to 
72,000  times  around  the  earth,  with  but  two  fatalities  due  to  train 
accidents.  I  have  given  you  the  facts  and  figures  relating  to  the 
road  with  which  I  am  connected,  but  this  I  believe  fairly  illus- 
trates what  all  the  great  railroads  of  our  countrj'  have  done  within 
the  last  few  years  to  make  passengers  on  our  trains  feel  that  they 
are  in  the  safest  place  in  the  world.  This  latter  statement  to  be 
construed  literally.  I  am  making  this  statement  in  the  presence 
of  men  who  probably  above  any  other  class  of  men  in  our  Nation 
know  the  value  of  statistics.  This  statement,  to  some,  may  be 
astounding.  I  realize  full  well  that  if  my  figures  and  deductions 
are  not  correct  I  shall  have  it  brought  to  my  attention.  But,  in 
support  of  my  statement,  I  call  your  attention  to  the  fact  that  a 
person  whose  business  causes  him  to  travel  nearly  every  day  in 
the  year  as  a  passenger  on  our  railroads  can  obtain  a  $5,000  cas- 
ualty policy  for  $9  a  year,  while  the  same  policy  costs  any  other 
class  of  our  citizens  $25  a  year. 

We  are  now  inviting  the  citizens  along  our  road  to  become  mem- 
bers of  our  Safety  First  committees,  and  I  want  to  say  we  are  hav- 
ing great  success.  We  are  also  teaching  Safety  First  in  the  schools 
along  our  lines,  for  the  purpose  of  conforming  strictly  to  the  spirit 

•  Increase  in  numhcr  of  passengers  injured  during  fiscal  year  of  1915  due 
to  a  collision — all  injuries  however  being  very  slight. 


WORLD'S  INSURANCE  CONGRESS  419 

of  cooperation.  All  serious  accidents  happening  on  our  road  are 
investigated  by  a  board  partly  composed  of  the  public,  and  the 
findings  of  these  boards  are  published  in  the  leading  newspapers. 

Many  of  the  things  the  railroads  of  our  country  have  done  for 
the  protection  of  the  public  in  the  last  few  years  are  now  a  matter 
of  record.  This  work  has  also  brought  the  managers  and  the  men 
into  closer  contact.  I  believe  it  has  been  an  object  lesson  to  all 
whose  minds  have  not  been  seared  by  prejudice. 

So  much  for  the  past.  The  present  is  filled  with  bright  pros- 
pects, and  we  start  off  feeling  that  the  plan  of  competition  in  the 
industrial  world  is  dead  and  that  cooperation  has  taken  its  place. 
We  believe  "that  an  organization  is  no  better  than  its  worst  ele- 
ment." The  greatest  reward  in  the  future  then  will  be  to  the 
railroad  companies  who  best  succeed  in  developing  the  individual 
units.  This  was  commenced  when  apprentice  schools  were  intro- 
duced, and  will  be  worked  out  through  the  vocational  schools  in 
connection  with  all  our  big  corporations,  if  in  addition  to  the  learn- 
ing connected  with  them  the  true  spirit  of  cooperation  shall  pre- 
vail. I  think  the  greatest  thought  of  this  age  was  expressed  by 
Mr.  Howard  Elliott,  soon  after  he  had  taken  the  position  as  Presi- 
dent of  the  New  York,  New  Haven  and  Hartford  Railroad,  when 
he  said  that  wrecks  and  disasters  could  be  stopped  only  by  the 
heads  of  departments  working  with  their  men  instead  of  at  them. 
Dr.  Charles  W.  Eliot,  President  Emeritus  of  Harvard  University, 
enlarged  upon  this  thought  when  he  said  in  a  recent  address  to 
the  students  of  that  institution,  "I  have  been  studying  now  for  a 
good  many  years  the  question  of  content  in  labor,  and  I  have 
come  to  the  definite  conclusion  that  the  conditions  of  content  in 
labor  which  I  have  enjoyed  personally  are  those  which  all  laboring 
people  ought  to  enjoy."  I  think  that  we  will  all  agree  that  con- 
tentment and  efficiency  go  hand  in  hand,  and  that  contentment 
cannot  be  bought  with  wages,  neither  can  it  be  forced;  but  it  can 
be  induced  by  the  application  of  that  sweet  human  philosophy  of 
the  Master — "Love  one  another."  I  believe  you  will  agree  with 
me  that  there  are  laws  which  govern  the  development  and  growth  of 
the  human  being  to  an  efficient  unit  in  the  organizations  just  as 
much  as  heat  and  light  and  moisture  govern  the  growth  of  vegeta- 
tion. I  believe  that  the  normal  man  will  be  just  as  much  inter- 
ested in  you  and  your  welfare  as  your  actions  convince  him  that 
you  are  interested  in  his  welfare.  I  believe,  further,  that  the 
normal  man  is  developed  by  placing  responsibility  on  him,  and 
it  is  only  through  cooperation  that  every  man  in  a  big  organi- 
zation will  feel  he  is  responsible  for  any  more  than  a  few  hours 
of  his  time  each  day.  Some  have  characterized  the  Ford  Automo- 
bile Company,  the  Commonwealth  Steel  Company,  and  others  sim- 
ilar, as  paternalistic  organizations,  but,  from  what  I  can  learn  of 
them,  they  seem  to  be  great,  big,  healthy,  wholesome,  efficient  cor- 
porations that  defy  competition.  From  what  we  read  in  the  news- 
papers recently  we  might  infer  that  young  Rockefeller  has  been 


420  WORLD'S  INSURANCE  CONGRESS 

caught  up  by  the  spirit  of  paternalism,  but  I  believe  he  has  been 
converted  to  the  fact  that  further  industrial  development  can  be 
obtained  only  through  cooperation.  If  this  be  true,  he  soon  will 
be  characterized  not  only  as  a  great  man  but  as  a  benefactor  to  the 
human  family. 

P.  B.  Juknke  writes:  "And  the  end  is  that  the  workman  shall 
live  to  enjoy  the  fruits  of  his  labor;  that  his  mother  shall  have 
the  comfort  of  his  arm  in  her  age;  that  his  wife  shall  not  be  un- 
timely a  widow;  that  his  children  shall  have  a  father,  and  that 
cripples  and  helpless  wrecks  who  were  once  strong  men  shall  not 
longer  be  a  by-product  of  industry." 

INDUSTRIAL  SAFETY 

By  Will  J.  French 
Director,  National  Safety  Council 

Mr.  Chairman,  Ladies  and  Gentlemen:  It  is  a  pleasure  to  rep- 
resent the  National  Safety  Council  at  this  meeting  and  to  observe 
that  the  dominant  note  at  the  sessions  of  the  World's  Insurance 
Congress  has  been  and  is  the  conservation  of  life  and  property. 

In  Milwaukee,  Wisconsin,  from  September  30  to  October  5, 
1912,  there  was  held  a  First  Cooperative  Safety  Congress.  This 
Congress  was  held  under  the  auspices  of  the  Association  of  Iron 
and  Steel  Electrical  Engineers.  As  an  outcome,  there  was  organ- 
ized the  National  Council  for  Industrial  Safety.  Offices  were 
opened  in  Chicago  on  October  13,  1913,  following  the  holding  of 
the  Second  Annual  Safety  Congress.  At  the  Third  Annual  Safety 
Congress,  held  in  Chicago,  October  13  to  15,  1914,  the  name  of  the 
organization  was  changed  to  that  of  National  Safety  Council.  It 
was  felt  that  the  inclusion  of  the  word  "industrial"  tended  to 
give  the  impression  of  a  limitation  of  activity  to  the  industrial 
field  alone.  This  is  not  the  aim  of  the  National  Safety  Council. 
The  organization  serves  as  a  national  clearing-house  for  safety. 

The  main  object  may  be  summed  as  follows : 

' '  To  coordinate  and  stimulate  all  phases  of  the  Accident  Preven- 
tion Movement  in  its  individual,  public  and  industrial  aspects." 

Membership  is  procured  as  follows: 

1.  By  direct  solicitation  from  the  head  office  in  Chicago. 

2.  By  the  efforts  of  those  who  are  members  of  the  National 
Safety  Council,  or  in  sympathy  with  its  aims  and  objects,  and 
who  lose  no  opportunity  of  urging  the  advisability  of  affiliation. 

3.  Through  the  efforts  of  the  membership  committee  of  the  dif- 
ferent local  councils. 

These  local  councils  are  organized  in  the  States  of  the  United 
States  and  all  have  affiliation  with  the  National  Safety  Council. 


WORLD'S  INSURANCE  CONGRESS  421 

To  date  there  are  1,432  members  of  the  National  Safety  Council, 
with  approximately  5,000  representatives  of  such  members.  All  of 
the  States  of  the  Union  have  representation  except  Nevada  and 
North  and  South  Dakota.  Some  of  the  members  are  located  in 
Australia,  Japan,  England,  India,  Scotland  and  Canada.  Over 
150  different  industries,  associations  and  national  and  state  or- 
ganizations are  comprised  in  the  membership.  There  are  20  local 
councils  organized  at  this  time,  and  steps  have  been  taken  to  in- 
crease this  number.  The  National  Safety  Council  sends  out  to 
all  its  members  a  valuable  weekly  bulletin.  This  bulletin  described 
ways  of  preventing  accidents.  It  gives  the  experiences  of  those 
who  are  active  in  accident  prevention.  Illustrations  drive  home 
the  lesson  sought  to  be  conveyed  by  the  text. 

As  an  information  bureau  the  National  Safety  Council  gives 
prompt  and  definite  answers  to  questions  which  its  members  ask 
regarding  safety  problems  in  their  plants. 

The  local  councils  are  kept  informed  of  developments  in  acci- 
dent-prevention work.  Addresses  and  exhibits  are  loaned  on  re- 
quest. 

A  list  of  competent  lecturers  and  safety  experts  are  available. 
These  men  are  glad  to  donate  their  services  to  the  cause,  unless 
travling  expenses  are  necessary. 

Moving  pictures  and  stereopticon  slides  are  placed  at  the  dis- 
posal of  the  members  without  charge.  This  method  of  influencing 
public  opinion  has  proved  valuable.  In  visiting  large  industrial 
centers  the  "movies"  impress  the  lesson  on  those  who  see  them. 

A  special  committee  is  endeavoring  to  standardize  safety  de- 
vices in  the  industries. 

Practical  service  in  plant  sanitation  and  vocational  diseases  is 
furnished  through  the  Industrial  Hygiene  Committee. 

Each  year  an  Annual  Safety  Congress  is  held.  Wide  publicity 
is  given  to  the  addresses,  the  illustrated  lectures  and  the  general 
discussions  that  take  place  at  these  Congresses.  The  cost  of  mem- 
bership in  this  organization  is  small.  Full  information  can  be  ob- 
tained by  writing  to  the  National  Safety  Council  in  Chicago. 

The  student  of  ancient  history  finds  many  references  to  safety 
activities.  In  Deuteronomy,  the  fifth  book  of  Moses,  chapter  22, 
verse  8,  is  found  the  following  command:  "When  thou  buildest 
a  new  house,  then  thou  shalt  make  a  battlement  for  thy  roof,  that 
thou  bring  not  blood  upon  thine  house,  if  any  man  fall  from 
thence."    A  battlement  is  a  form  of  safety  device. 

While  industrial  safety  has  only  become  a  theme  of  general  dis- 
cussion in  the  United  States  during  the  past  few  years,  there  is 
satisfaction  in  knowing  that  we  are  trying  to  make  up  for  lost 
time.  The  stigma  that  the  Nation  is  heedless  to  the  human  toll 
of  industry  is  disappearing. 

Since  1906  the  United  States  Steel  Corporation  has  a  yearly 
average  of  43  per  cent  reduction  in  accidents.     Many  other  large 


422       WORLD'S  INSURANCE  CONGRESS 

concerns  have  excellent  records,  but  there  was  lacking  concerted 
effort  until  the  appearance  of  workmen's  compensation  laws. 

Professor  Irving  Fisher,  of  Yale,  estimates  that  of  the  1,500,000 
deaths  annually  in  the  United  States,  630,000  are  preventable.  He 
gives  industrial  accidents  the  sixth  place  in  the  list  of  causes  of 
unnecessary  deaths. 

The  Nationaly  Safety  Council  quotes  striking  figures  of  indus- 
trial accidents  in  this  country:  One  worker  killed  each  fifteen 
minutes,  daj'  and  night,  and  one  injured  each  sixteen  seconds. 
More  than  30,000  are  killed  yearly  and  fully  2,000,000  injured. 

The  railroads  of  the  land  have  given  splendid  contributions  to 
Safety  First.  The  Southern  Pacific  Company  won  the  E.  H. 
Harriman  Memorial  Medal  in  1913.  Not  one  passenger  was  killed 
during  the  five  years  prior  to  the  winning  of  the  medal.  During 
the  period  eight  thousand  million  passengers  were  carried. 

In  California  industrial  safety  received  an  impetus  with  the 
passage  of  the  Workmen's  Compensation,  Insurance  and  Safety 
Act.  Skilled  safety  engineers,  selected  exclusively  because  of  their 
abilities,  have  assisted  employers  to  guard  their  establishments. 
Education  is  the  vital  force  of  the  accident-prevention  propaganda. 
This  education  should  be  general.    None  of  us  are  too  old  to  learn. 

Shop  committees  are  extremely  valuable  in  preventing  accidents. 
The  man  right  on  the  job  knows  best  what  is  needed. 

Home-made  safeguards  are  advocated.  They  can  be  inexpen- 
sively furnished. 

California  has  cooperated  with  the  United  States  Bureau  of 
Mines  in  the  mining  field,  and  there  is  in  contemplation  a  sim- 
ilar plan  in  the  domain  of  electricity  under  the  auspices  of  the 
United  States  Bureau  of  Standards. 

Safety  devices  are  exhibited  in  museums  in  San  Francisco  and 
Los  Angeles. 

Employers  and  employees  are  preparing  safety  orders  in  the 
different  industries.  This  method  has  proved  sound.  Practical 
men  representing  all  sections  of  the  community  are  better  adapted 
to  plan  safeguards  than  are  men  unacquainted  with  industrial 
operations. 

It  is  pleasing  to  refer  to  the  help  received  from  California's  em- 
ployers. Reduction  in  accidents  is  attractive.  It  lowers  insurance 
rates.  Men  do  not  want  to  see  other  men  killed  or  hurt  while  they 
are  at  work.  Efficiency  and  increased  output  follow  in  the  wake 
of  the  removal  of  danger.  "Safety  First"  is  the  slogan  of  modern 
industrialism. 


WORLD'S  INSURANCE  CONGRESS  423 


SAFETY  FIRST  FROM  A  STREET  TRAFFIC  STANDPOINT 

By  Lieut.  Duncan  Matheson 
San  Francisco  Police  Department 

Mr.  Chairman,  Ladies  and  Gentlemen:  The  World's  Insurance 
Congress  requested  me  to  say  a  few  words  to  you  on  the  slogan 
"Safety  First"  from  a  street  traffic  standpoint  in  this  city  and  I 
regret  exceedingly  that  the  time  is  so  limited,  on  account  of  the 
remainder  of  the  program,  that  I  cannot  tell  you  all  that  I  intend- 
ed ;  but  if  anything  that  I  should  say  would  impress  you  with  the 
greatest  movement,  without  any  exception,  before  the  American 
people  to-day,  I  will  feel  that  at  least  I  have  done  some  good  for 
this  city  and  the  country  at  large. 

Let  us  for  a  moment  pause  and  consider  our  accident  reports 
for  the  year  ending  1914.  The  police  reports  show  that  54  fatal 
accidens  occurred  during  that  year,  classified  as  follows:  four 
from  teams,  22  from  street  cars  and  28  from  automobiles  and  other 
motor  vehicles,  and  the  deplorable  part  is  that  each  and  every 
one  of  those  accidents  were  preventable  by  following  a  few  simple 
rules.  Let  us  analyze  for  a  moment.  The  four  deaths  from  teams 
were  caused  by  "runaways,"  three  being  of  the  drivers  and  the 
other  of  a  lady  struck  by  a  runaway  team.  What  is  the  solution  ? 
Simply  secure  the  teams  properly  and  lock  the  wheels.  This  was 
very  forcibly  brought  to  the  attention  of  the  teaming  interests 
and  the  drivers,  and  this  year  to  date  this  class  of  accident  has 
been  eliminated. 

Now  take  up  the  street  car  accidents,  and  we  have:  runaway 
cars  on  grades,  head-on  collisions,  rear-end  collisions  and  collisions 
with  vehicles  of  all  classes,  and  persons  struck  by  cars,  and  from 
persons  attempting  to  board  or  leave  cars  in  motion.  Would  time 
permit,  I  could  point  out  to  you,  without  fear  of  contradiction, 
that  each  and  every  one  of  these  deaths  could  have  been  prevented 
by  observing  a  few  simple  rules. 

Take  the  deaths  caused  by  automobiles  operating  on  our  streets 
and  they  can  be  classed  as  joy-riding,  collisions,  head-on  and  rear, 
bright  headlights,  careless  driving  and  losing  control  at  critical 
times.  What  was  said  about  the  two  other  classes  can  be  safely 
said  of  these,  and  think  for  a  moment  what  suffering  and  pain  and 
what  anguish  and  sorrow  could  have  been  saved,  if  these  simple 
niles  had  been  observed — we  could  have  these  unfortunate  per- 
sons with  us  to-day. 

Now  let  me  tell  you  about  something  that  has  been  accomplished 
with  our  school  children  during  the  last  year.  Unfortunately  sev- 
eral school  children  were  killed  by  vehicles,  either  going  to  or  re- 
turning from  school,  or  during  the  recess  sessions,  about  two  and  a 
half  years  ago.     The  problem  was  taken  up  by  the  Police  Depart- 


424       WORLD'S  INSURANCE  CONGRESS 

ment  and  the  Board  of  Education,  the  object  in  view  being  to  save 
the  children.  Signs  were  put  up  in  conspicuous  places  near  the 
schools  to  warn  drivers  of  the  proximity  of  a  school  and  telling 
them  to  drive  with  caution.  A  few  simple  rules,  seventeen  in  num- 
ber, were  compiled  hy  the  Police  Department  and  printed  on  a 
leaflet  and  distributed  to  the  schools  telling  how  to  use  the  streets 
with  safety;  and  the  Board  of  Education  by  resolution  compels 
the  teachers  to  read  these  rules  to  the  children  once  a  month  so 
that  they  will  ever  be  fresh  on  their  memories.  Police  officers  were 
detailed  at  the  schools  at  the  opening  and  closing  sessions.  And 
what  was  the  result?  I  am  proud  to  say  that  not  a  school  child 
w^as  killed  during  the  last  year  or  up  to  the  present  time. 

Ladies  and  Gentlemen,  let  me  ask  you  in  all  earnestness:  Is 
it  M'orth  while?  There  can  only  be  one  answer:  It  is.  Then  I 
appeal  to  you  as  an  officer — take  this  motto  "Safety  First"  home 
with  you,  keep  it  there;  think  about  it;  act  upon  it;  and  then 
pause  and  think  how  many  lives  you  save  in  a  potential  w^ay  by 
doing  your  part  in  the  work.  I  would  like  to  talk  to  you  for  an 
hour  on  this  work  alone — but  time  will  not  permit. 

"What  we  want  and  must  eventually  have  is  a  uniform  traffic  law 
for  the  United  States.  It  is  not  right  and  conducive  to  public 
safety  that  every  town,  city  and  State  should  have  different  rules 
for  the  operation  of  cars  or  vehicles,  causing  confusion,  inconven- 
ience and  even  injustice,  and  arrests  are  frequently  made  for  try- 
ing to  follow  a  rule  in  two  cities.  Let  me  suggest  right  here  that 
if  "Safety  First  Leagues"  existed  in  all  cities,  you  could  count 
the  years  on  the  fingers  of  one  hand  within  which  we  could  have 
uniform  traffic  laws  throughout  the  land. 

That  opens  up  a  new  field:  We  want  uniform  enforcement  as 
well.  What  is  considered  a  serious  infraction  in  one  city  is  con- 
sidered of  little  or  no  importance  in  another.  I  figured  from  the 
Court  Records  during  the  last  half  of  the  year  1914  that  it  cost 
$13.30  in  fines  for  each  violation  in  New  York  City  against  $1.45 
in  San  Francisco,  and  should  it  happen  here  on  Thanksgiving  or 
Christmas  Day,  turkey  and  cranberry  sauce  would  be  thrown  in. 
Does  that  seem  right  to  you  ?  It  does  not  to  me,  and  do  not  let  us 
comfort  ourselves  that  it  is.  What  we  need  is  a  corrective  punish- 
ment that  will  clinch  itself  on  the  mind  of  the  offender  that  he  is 
punished  not  because  he  has  violated  a  simple  rule,  but  that  he  has 
violated  the  "Safety  First  Principle." 

Take  for  example  the  selfish  automobilist  who  operates  a  car 
with  glaring  headlights  without  any  regard  for  the  public  at 
large.  Don't  you  think  that  there  is  something  wrong  with 
a  person  so  selfish  as  that?  I  do,  and  if  an  appeal  to  their  man- 
or womanhood  would  not  be  effective,  then  corrective  punishment 
should  be  applied. 

What  is  needed  is  cooperation  between  the  public  at  large,  the 
Police  Department,  and  the  courts  who  must  adjudicate  on  these 
matters  of  vital  importance  to  this  community.     How  can  this  be 


WORLD'S  INSURANCE  CONGRESS  425 

accomplished?  Very  easily,  so  simply  I  am  almost  ashamed  to 
tell  you  how — just  work  from  the  "Safety  First"  basis,  take  up 
the  little  things  and  the  larger  will  follow.  Remember  that  the 
police  are  not  all  poM'erful  and  are  liable  to  mistakes  and  that 
they  have  much  to  learn  about  "Safety  First,"  although  the 
foundations  of  all  Police  Departments  are  built  on  the  rock  ' '  Safety 
First"  because  it  is  our  first  duty  to  protect  life  and  property. 

I  only  wish  that  time  would  permit  to  say  more,  but  I  want 
to  impress  on  you  to  make  some  sacrifices  in  the  way  of  a  little 
time  when  you  use  the  streets,  to  cross  at  the  intersections,  and 
safety  zones,  which  are  clearly  indicated  by  white  lines  on  the 
pavement,  at  the  car  stops. 

Let  me  appeal  to  you  as  a  man  and  a  citizen  to  give  this  slogan 
the  place  it  deserves  in  your  mind  and  heart,  and  act  upon  it  as 
your  conscience  dictates,  and  you  will  find  more  real  joy  and 
comfort  from  it  than  in  anything  else  upon  the  top  of  this  earth. 
You  can  weigh  it  against  the  plaudits  and  encomiums  of  the  mul- 
V  titude  and  you  will  not  find  it  wanting;  and  believe  me,  there  is 
more  pleasure  in  being  right  and  doing  what  is  right  than  in  all 
other  sources  of  enjoyment  combined. 

I  thank  you. 


V.  APPENDICES 


I.     REPORTS  AND  RESOLUTIONS 

Report  of  Resolutions  Committee 

The  following  resolutions  were  presented  by  the  Resolutions 
Committee  at  a  meeting  of  the  National  Council,  and  were  unani- 
mously adopted  as  read: 

FIRST 

THE  WORLD'S  INSURANCE  CONGRESS,  representing  aU 
branches  of  the  insurance  business  and  including  many  related  or- 
ganizations, assembled  under  call  of  the  Insurance  Commission  of 
the  Panama-Pacific  International  Exposition,  hereby  expresses  its 
sincere  appreciation  of  the  public  recognition  given  by  this  latest 
and  greatest  Exposition  to  Insurance  as  an  institution  of  wide 
social  and  economic  importance,  and  for  having  given  it  a  place 
of  preeminence  in  the  Exposition's  activities. 

\Ye  beg  to  thank  the  officials  who  were  instrumental  in  placing 
insurance  on  a  plane  with  the  other  important  arts  and  industries, 
thus  recognizing  without  question  the  splendid  service  which  it  is 
rendering  to  millions  of  American  citizens ;  and  we  would  mention 
especially  in  this  connection  Charles  C.  IMoore,  the  honored  Presi- 
dent of  the  Exposition,  W.  L.  Hathaway,  Commissioner  of  Insur- 
ance Events,  and  the  Executive  Committee  of  the  World's  Insur- 
ance Congress  Events,  through  whose  untiring  efforts  and  unfailing 
loyalty  the  attention  of  the  world  has  been  called  to  the  intimate 
relation  which  insurance,  in  its  many  forms,  bears  to  the  welfare 
and  progress  of  the  world. 

The  discussions  which  have  taken  place  under  the  program  ar- 
ranged for  this  Congress  have  been  most  helpful  and  cannot  fail 
to  raise  higher  ideals  and  afford  new  inspiration  for  all  those  who 
are  engaged  in  insurance  work,  and  we  take  this  opportunity  to 
congratulate  the  men  who  prepared  and  presented  addresses  on 
this  occasion  upon  the  excellence  of  their  contributions  to  the 
cause  of  insurance  and  upon  the  certainty  that  their  efforts  have 
placed  the  entire  world  under  obligations  to  them.  We  would 
thank  also  the  General  and  Special  Chairmen  who  lent  their  pres- 
ence and  influence  to  make  this  Congress  the  most  notable  in  the 
history  of  the  insurance  business. 

We  are  proud  to  hear  it  said  that  this  magnificent  City  of  San 
Francisco  stands  to-day  as  a  lasting  memorial  to  the  wisdom  and 
value  of  cooperation  and  brotherhood  as  it  works  out  in  practice 

426 


WORLD'S  INSURANCE  CONGRESS  427 

through  insurance  companies,  but  we  beg  to  assure  the  citizens  of 
the  City  of  San  Francisco  and  of  the  State  of  California  that 
any  obligation  they  may  have  felt  toward  Insurance  for  aid  in  re- 
building their  city  has  been  more  than  canceled  by  the  cordiality 
of  their  welcome  to  this  Congress  and  the  many  courtesies  that 
have  been  extended  to  its  delegates. 

The  World's  Insurance  Congress  must  soon  end,  and  memory  of 
it  may  fade  with  the  lapse  of  time,  but  our  recollections  of  the 
pleasure  afforded  us  by  California  hospitality  will  remain  forever. 

SECOND 

Whereas,  The  Panama-Pacific  International  Exposition  has 
deemed  it  proper  to  give  Insurance  a  place  of  prominence  in  its 
activities,  and  through  its  Insurance  Commission  has  on  many  oc- 
casions provided  insurance  events  of  great  interest  and  importance, 
beginning  with  the  dedication  of  the  Exposition's  first  completed 
building  and  continuing  down  to  the  close  of  this  World's  Insur- 
ance Congress;  and 

Whereas,  These  insurance  events  have  given  rise  to  the  delivery 
of  many  notable  addresses  bj''  men  of  local,  national,  and  even  of 
international  fame,  all  bearing  on  insurance  and  its  important  re- 
lations to  the  public  welfare ;  and 

Whereas,  It  is  believed  that  a  complete  report  of  this  movement, 
including  publication  of  the  addresses  and  papers  presented  on 
these  many  occasions,  w^ould  afford  a  most  valuable  contribution  to 
the  literature  which  is  needed  for  the  education  of  the  public  and 
of  insurance  men  themselves  concerning  the  value  of  insurance  in 
its  many  forms,  and  the  important  functions  it  performs  in  social 
economy. 

Now,  Therefore,  be  it  Resolved,  as  the  sense  of  the  World's 
Insurance  Congress,  that  the  entire  history  of  this  movement  and 
the  addresses  delivered  in  connection  therewith  ought  to  be  pre- 
served, printed  and  distributed  as  widely  as  possible,  and  that 
before  the  Congress  adjourns  a  way  should  be  found  whereby  this 
important  result  can  be  accomplished. 

THIRD 

Whereas,  The  Panama-Pacific  International  Exposition  has  offi- 
cially recognized  the  importance  of  Insurance  as  a  factor  in  social 
economy  by  having  created  a  Commission  to  promote  and  take 
charge  of  insurance  events;  and 

Whereas,  Such  Commission  has  organized  and  conducted  many 
exercises  and  meetings,  at  which  the  nature  and  value  of  insurance 
in  its  relation  to  the  every-day  life  of  the  people  has  not  only  been 
clearly  set  forth,  but  to  an  extent  never  before  attempted  has 
been  brought  to  the  attention  of  the  public  throughout  the  entire 
world;  and 

Whereas,  Such  conferences  and  discussions  have  been  brought 


428       WORLD'S  INSURANCE  CONGRESS 

to  a  culmination  in  a  World's  Insurance  Congress,  representing 
more  than  one  hundred  organizations  of  insurance  and  allied  in- 
terests, with  national  and  international  influence,  whose  purposes 
are  not  to  promote  the  business  of  any  company  or  group  of  com- 
panies from  a  commercial  standpoint,  but  rather  to  further  insur- 
ance as  an  institution  for  service,  and  to  encourage  the  betterment 
thereof;  and 

Whereas,  It  appears  from  the  many  addresses  presented  at  the 
Congress  and  in  the  several  Exposition  insurance  events  which 
have  preceded  it,  that  while  Insurance  is  without  doubt  one  of  the 
strongest  forces  at  work  for  the  prevention  of  loss,  the  conservation 
of  life  and  property,  and  for  teaching  the  value  of  cooperation 
as  a  means  of  protection  against  the  vicissitudes  of  life,  that  it 
has  been  unfairly  hampered  and  unnecessarily  burdened  in  many 
ways  to  the  great  detriment  of  the  public  welfare ; 

Now,  THEREFORE,  BE  IT  Resolved,  That  while  the  problems  at- 
tendant upon  the  congestion  of  population  doubtless  make  it  nec- 
essary to  extend  statutory  control  and  regulation  of  large  business 
activities  beyond  what  in  earlier  days  would  have  been  deemed 
proper,  it  is  of  the  utmost  importance  that  such  interference  with 
personal  freedom  and  initiative  should  not  be  unnecessarily  ex- 
tended. We  deplore,  therefore,  the  great  diversity  of  require- 
ments existing  in  State  laws,  and  urge  upon  legislators  and  public 
officials  generally  the  importance  of  striving  for  greater  uniform- 
ity, even  to  the  extent,  when  necessary,  of  sacrificing  individual 
wishes  and  preferences.  We  believe  that  it  is  only  by  adherence 
to  this  principle  in  legislation  that  the  institution  of  insurance  will 
be  enabled  to  serve  satisfactorily  the  best  interests  of  the  public 
at  large. 

Furthermore,  we  would  call  attention  to  the  fact  that  Insur- 
ance is  the  sharing  of  losses,  which,  if  allowed  to  fall  upon  indivi- 
duals alone,  would  spell  ruin  in  most  cases.  We  deplore,  therefore, 
adding  to  these  losses  the  burden  of  special  taxes  imposed  for  gen- 
eral State  and  National  purposes. 

We  hold  it  to  be  indisputable  that  in  the  last  analysis  tax  bur- 
dens fall  upon  policyholders,  either  increasing  the  amount  they 
pay  for  insurance  protection  or  decreasing  the  amount  of  insur- 
ance which  they  would  otherwise  carry. 

We,  therefore,  declare  it  to  be  the  sense  of  the  World's  In- 
surance Congress  that  taxation  of  the  business  of  insurance,  whose 
purpose  is  primarily  to  distribute  as  widely  as  possible  the  shocks 
occasioned  by  losses  of  life,  health  and  property,  should  be  con- 
fined strictly  to  providing  funds  sufficient  for  its  super^'ision  and 
regulation. 

Report  of  Committee  on  Permanent  Organization 

The  Committee  on  Permanent  Organization,  through  its  chair- 
man, Charles  H.  Holland,  reported  to  the  National  Council  as  fol- 
lows: 


WORLD'S  INSURANCE  CONGRESS  429 


TENTATIVE  PLAN  FOR  ORGANIZATION  OF  A  NATIONAL 
INSURANCE    COUNCIL 

Your  Committee  has  concluded  that  the  unique  opportunity 
provided  by  the  AVorld's  Insurance  Congress  should  be  availed 
of  to  organize  a  permanent  Council  or  Committee  of  general  na- 
tional insurance  interests. 

The  advantages  of  such  an  organization  are  obvious,  the  need 
of  such  an  organization  is  unquestioned,  and  the  possible  value  of 
such  an  organization  is  almost  incalculable. 

Your  Committee  therefore  recommends  that  a  permanent  Na- 
tional Insurance  Council  shall  be  organized ;  and  it  suggests  as  a 
general  basis  of  the  organization  the  following  plan,  which  is  sub- 
mitted upon  the  understanding  that  if  adopted  by  the  National 
Council  of  the  World's  Insurance  Congress — it  shall  be  subject 
to  such  changes  in  detail  as  the  Provisional  Central  Committee 
may  deem  necessary: 

First.  The  fundamental  function  or  purpose  of  the  Council  is 
to  effectively  organize  for  national  purposes  all  insurance  interests 
and  related  activities. 

Second.  The  Council  by  its  Constitution  and  By-laws  shall 
limit  itself  to  the  consideration  of  insurance  questions  or  problems 
common  to  insurance  interests  and  activities  related  thereto. 

Third.  The  membership  of  the  Council  shall  consist  of  national 
organizations  of  insurance  and  related  activities  admitted  by  the 
unanimous  vote  of  the  Central  Committee  as  hereinafter  pro- 
vided for  by  the  votes  of  not  less  than  two-thirds  of  the  member- 
ship of  the  Council.  There  shall  be  charged  an  admission  fee  of 
Twenty-five  Dollars  ($25.00)  to  the  associations  constituting  the 
National  Council  for  general  administrative  purposes, 

Faurth.  The  governing  body  of  the  Council  shall  consist  of  a 
Central  Committee  of  not  to  exceed  three  members  each  of  the  fire, 
the  life,  the  casualty  and  surety,  the  marine,  and  the  fraternal 
branches  of  insurance. 

Fifth.  The  Council  as  a  body  shall  meet  at  least  once  in  three 
years,  but  special  meetings  may  be  called  at  any  time  at  the  re- 
quest of  a  majority  of  the  Central  Committee. 

Sixth.*  Each  association  or  organization  holding  membership 
in  the  National  Insurance  Council  shall  be  represented  by  a  dele- 
gate or  alternate  selected  in  accordance  with  its  own  rules.  In  case 
the  ofiScial  delegate  is  unavoidably  prevented  from  participating 
in  the  meeting  of  the  Council,  his  place  shall  be  filled  by  the  al- 
ternate. 

Seventh.  The  Central  Committee  shall  hold  at  least  one  general 
meeting  annually,  but  special  meetings  may  be  called  at  any  time 
upon  the  written  request  of  not  less  than  five  of  its  members. 

Eighth.     The  Central  Committee  shall  adopt  a  plan  of  its  own 

*As  amended. 


430       WORLD'S  INSURANCE  CONGRESS 

organization  as  it  may  deem  best,  but  all  services  to  be  rendered 
by  the  members  of  the  same  in  connection  therewith  shall  be  with- 
out compensation. 

Ninth.  The  Central  Committee  being  authorized  by  the  Execu- 
tive Committee  of  the  World's  Insurance  Congress,  shall  take  en- 
tire charge  of  the  editing,  publishing  and  distribution  by  sale  or 
otherwise  of  the  proceedings  of  the  congress  and  other  insurance 
events  of  the  Exposition. 

Tenth.  The  Central  Committee  shall  frame  a  Constitution  and 
By-laws  for  the  permanent  government  of  the  National  Insurance 
Council. 

Eleventh.  A  Provisional  Central  Committee  shall  be  selected 
and  appointed  by  the  Executive  Committee  of  the  World's  Insur- 
ance Congress  before  the  date  of  final  adjournment,  subject  to 
ratification  by  the  National  Council  of  the  World's  Insurance  Con- 
gress. 

Twelfth.  The  provisional  Central  Committee  shall  have  all  the 
powers  provided  for  the  permanent  Central  Committee  until  such 
permanent  Central  Committee  shall  have  been  elected. 

Committee  on  Permanent  Organization, 
(Signed)  Charles  H.  Holland 

Chairman. 

Resolution  Drafted  by  Arthur  I.  Vorys  for  Adoption  by  the 
National  Council,  Commending  the  Services  of  Com- 
missioner W.  L.  Hathaway 

It  is  the  sense  of  the  National  Council  that  the  extraordinary 
and  successful  work  of  W.  L.  Hathaway  in  behalf  of  the  World's 
Insurance  Congress  is  worthy  of  distinct  commendation. 

Insurance  is  distinguished  among  the  arts  and  industries,  con- 
spicuously recognized  by  the  Panama-Pacific  International  Expo- 
sition. Insurance  has  found  an  abiding  place  in  the  minds  and 
conscience  of  the  people,  and  of  those  managing  the  business,  which 
it  never  occupied  before. 

This  was  accomplished  through  the  cooperative  efforts  of  those 
who  conceived,  promoted,  and  brought  about,  in  deed  as  well  as 
in  name,  the  AVorld's  Insurance  Congress.  Many  have  aided  in 
this  ambitious  project.  JMany  could  be  named  whose  work  has  been 
indispensable.  A  goodly  number  could  be  singled  out  for  resolu- 
tions of  appreciation  and  gratitude.  But  the  work  of  ]\Ir.  W.  L. 
Hathaway  calls  for  a  particular  and  emphatic  expression  from 
tbe  National  Council ;  and  in  this  we  know  we  voice  the  loyal  feel- 
ings of  the  executives  who  have  so  ably  and  earnestly  assisted  in 
this  great  enterprise. 

Insurance,  in  the  mind  of  Mr.  Hathaway,  is  an  institution  de- 
signed for  a  most  useful  service  in  all  the  varying  relations  and 
activities  of  mankind.  His  lofty  ambition  was  to  inspire  iii  all  an 
appreciation  of  insurance  in  its  exalted  rank  with  the  great  hu- 


WORLD'S  INSURANCE  CONGRESS  431 

mane,  cosmopolitan  institutions.  His  aspiration  could  be  effectu- 
ated by  a  convention  representing  all  insurance.  Such  a  conven- 
tion was  possible  and  practicable,  as  a  part  of  and  under  the 
prestige  of  the  World's  Exposition.  And  so  he  began  with  a  dis- 
interested and  most  admirable  zeal  in  his  work  for  a  most  noble 
cause.  And  so  he  has  continued.  And  so  his  work  has  reached 
a  culmination  of  vast,  incalculable  good,  not  only  to  insurance  and 
those  engaged  in  the  business,  but  to  all  the  people. 

His  motives  were  the  purest ;  his  eagerness  was  unselfish ;  his 
ambition  was  the  most  praiseworthy;  his  determination  was  un- 
yielding. He  met  innumerable  obstacles,  big  and  little;  he  con- 
quered and  surmounted  them  all.  He  has  spent  years  in  this  serv- 
ice, and  the  nights  as  well  as  days  have  been  nights  and  days  of 
toil.  He  has  played  no  favorites.  No  company  or  class  of  insur- 
ance, no  individual  or  class  of  individuals,  has  been  promoted  or 
slighted.  His  ideals  relate  to  insurance  as  an  institution,  not  to 
any  branch  of  the  business.  The  result  of  his  conception,  and  of 
his  organization,  and  of  his  work,  is  little  short  of  tremendous. 
His  reward  is  in  seeing  insurance  exalted.  His  ' '  medal  of  honor ' ' 
is  in  the  realization  that  insurance  emerges  from  this  Congress 
in  a  new  and  nobler  light,  and  that  the  opportunity  has  been  em- 
braced to  build  on  the  Congress  a  permanent  organization  for 
enlightenment,  protection,  preservation  and  development  of  hu- 
manity's institution  of  insurance. 

Therefore,  the  National  Council  of  the  World's  Insurance  Con- 
gress hereby  extends  to  Mr.  W.  L.  Hathaway  its  cordial  congratu- 
lations on  the  success  of  his  undertaking,  and  its  sincere  thanks, 
and  assurances  of  the  profound  appreciation  of  all  engaged  in 
the  business  of  insurance,  and  of  the  obligation  of  all  people  for 
his  great  service  to  all  in  behalf  of  the  World's  Insurance  Con- 
gress and  the  events  connected  therewith. 


II.     ARTICLES,    LETTERS   AND   PAPERS   RELATING    TO 
WORLD'S  INSURANCE  CONGRESS  MOVEMENT 

WORLD'S  INSURANCE  CONGRESS 

Address  Delivered  by  Special  Commissioner  Will  G.  Tappinder 

Before  the  National  Association  of  Life  Underwriters, 

Memphis,  September  17,  1912 

I  am  deeply  impressed  in  appearing  before  this  convention  both 
with  the  opportunity  afforded  me  to  address  it  and  with  the  re- 
sponsibility which  I  assume  as  the  representative  of  Mr.  W.  L. 
Hathaway,  Commissioner  of  the  Panama-Pacific  International  Ex- 
position for  the  World's  Congress  of  Insurance,  and  also  Mr.  C.  C. 
Moore,  the  President  of  the  Panama-Pacific  Exposition.  I  am  but 
the  mouthpiece  to  deliver  to  you,  in  so  far  as  I  may  be  able,  the 


432  WORLD'S  INSURANCE  CONGRESS 

message  with  which  I  am  charged.  It  concerns  a  glorious  trinity: 
the  World's  Insurance  Congress — especially  interesting  to  this 
body — the  Panama-Pacific  International  Exposition,  and  the  Pan- 
ama Canal,  interesting  to  the  entire  world. 

When  the  Great  Master  at  the  end  of  His  seven  days'  labor 
found  his  work  good,  and  rested,  He  gave  to  His  children  the 
earth  and  the  fulness  thereof;  and  the  beneficent  power  which 
created  the  glory  of  the  firmament,  with  the  sun  by  day  and  the 
moon  by  night,  we  may  rest  assured  ordained  that  with  the  ripen- 
ing ages  should  come  the  great  fruitage  of  this  century's  achieve- 
ments. Under  this  beneficent  power  the  United  States  and  the 
American  people  have  evolved  until  they  rank  to-day  as  exemplars 
of  all  that  makes  a  nation  great — a  God-following  and  a  peace- 
loving  people,  preaching  and  practising  "Peace  on  Earth — Good 
Will  to  Men." 

In  all  the  vast  grandeur  of  this  century's  achievements  in  all  the 
advances  in  Science,  in  Art,  in  Commerce,  looking  to  the  common 
welfare  and  the  general  good,  the  most  stupendously  grand 
achievement  is  the  divorcing  of  the  union  of  the  North  and  South 
American  continents,  and  the  resulting  wedding  of  the  waters  of 
the  Atlantic  and  Pacific  by  the  Panama  Canal.  Four  hundred 
million  dollars  is  the  price  in  cash  which  this  nation  gladly  pays 
as  the  marriage  fee.  Plus  this,  the  United  States  has  endowed 
the  Canal  with  the  energy,  the  ability,  the  brains,  and  in  some 
eases  the  lives  of  its  bravest  and  best  sons  who  have  gone  on  a 
mission  of  peace  to  conquer  where  others  failed.  This  mission 
gives  a  new  waterway  to  the  commerce  of  the  world,  shortens  dis- 
tance, conserves  time,  and  establishes  as  a  practicality  the  theory 
of  "Hands  Across  the  Sea."  With  the  passing  of  the  first  ship 
through  the  Canal  will  be  written  the  first  chapter  in  a  new  his- 
tory of  the  world's  achievements.  Traditions  will  be  shattered, 
and  new  facts  realized.  Cities  teeming  with  busy  life  will  rise 
Aladdin-like  to  the  accompanying  music  of  rattling  machinery  and 
the  hum  of  manufactories. 

Under  the  new  conditions  created,  the  center  of  the  world's 
greatest  activities  and  advancement  will  shift  from  the  East  to  the 
West.  Here  will  be  the  future  great  seats  of  learning  and  the 
homes  of  scientific  progress.  Already  the  cities  of  the  Pacific 
Coast  are  hearing  the  first  faint  ripple  of  the  waves  as  they  wash 
the  prows  of  the  argosies  of  the  nations  bringing  to  California's 
shores  the  commerce  and  fruits  of  the  labor  of  the  toiling  millions 
of  the  Orient.  Here  is  the  theater  of  the  new  and  near  future 
with  the  stage  already  set  on  which  will  be  enacted  the  solution 
of  the  last  problem  of  our  complex  civilization ;  the  assimilation 
and  absorption  of  the  intermixing  human  races  who  from  the  very 
nature  of  things  must  gravitate  here.  "The  womb  of  the  future 
is  big  with  events." 

'The  celebration  of  the  completion  of  the  canal  wnth  all  the  known 
and  unknown  benefits  which  will  inure  to  both  this  Nation  and  the 


WORLD'S  INSURANCE  CONGRESS  433 

world  at  large,  the  commencement  of  a  new  era,  and  marking  the 
opening  chapter  of  a  new  history,  should  be  held  in  San  Francisco, 
the  principal  city  of  the  Western  Coast. 

San  Francisco  is  a  typical  city;  it  is  peopled  by  the  pioneers 
and  their  descendants;  their  education  and  training  are  those  of 
the  blazers  of  the  trail  who  out  of  the  crucible  of  conflict  waged 
against  primal  conditions  emerged  able  to  meet  and  conquer  the 
untamed  forces  of  the  West,  harness  its  streams  and  bridge  its 
rivers,  people  its  plains  and  till  its  valley's — men  descended  from 
forefathers  whose  daily  lives  and  tasks  left  possible  only  the  sur- 
vival of  the  fittest. 

By  such  brawn  and  brains  San  Francisco  has  been  created ;  and 
it  is  in  the  very  center  of  the  new  order  of  things  which  is  prac- 
tically turning  the  world  "about  face"  by  means  of  the  canal. 

From  its  geographical  location,  and  from  the  vitality  of  its 
men,  San  Francisco  became  the  logical  place  at  which  the  celebra- 
tion of  the  completion  of  the  canal  should  transpire.  The  world 
flung  the  challenge  to  the  West,  and  from  out  the  arena  of  com- 
mercial combat  San  Francisco  picked  the  gauge  to  weave  it  into 
a  chaplet  of  the  laurel  leaves  of  victory. 

San  Francisco  rebuilt  and  the  Panama  Canal  are  the  two  great- 
est American  achievements  of  the  century,  and  the  World 's  Insur- 
ance Congress  in  its  domain  will  be  equally  magnificently  great. 

The  Exposition  is  a  great  National  enterprise  determined  by 
Congress  and  designated  by  the  President  to  celebrate  the  com- 
pletion of  the  canal.  That  ' '  San  Francisco  knows  how ' '  is  shown 
by  the  energy  with  which  the  city  is  doing  the  work  entrusted  to 
it  by  the  Nation.  In  the  famous  April  meeting  of  1910  the  citizens 
of  San  Francisco  in  less  than  120  minutes  raised  by  voluntary 
subscription  over  $4,000,000  for  the  Exposition.  Seven  million 
five  hundred  thousand  dollars  by  public  subscription  has  been 
raised  in  San  Francisco  alone.  In  addition,  the  City  has  author- 
ized a  $5,000,000  bond  issue,  while  the  State  has  added  another 
$5,000,000.  Practically  every  county  in  California  has  levied  a 
6-cent  Exposition  tax,  San  Francisco  and  California  will  invest 
$20,000,000  in  the  Exposition  before  the  gates  open  on  February 
29,  1915. 

California  and  San  Francisco  have  not  a  monopoly  of  the  en- 
thusiasm aroused  over  the  Exposition ;  New  York  alone  has  appro- 
priated $700,000,  and  other  States  are  preparing  to  follow  this 
lead.  Sites  for  special  buildings  on  the  Exposition  grounds  have 
been  selected  by  the  following  States:  New  York,  New  Jersey, 
Pennsylvania,  IMissouri,  Kentucky,  ]\Iinnesota,  Montana,  Idaho, 
South  Dakota,  Nevada,  Utah,  Arizona,  Oregon,  the  Philippine 
Islands  and  Hawaii. 

Up  to  this  time  the  foreign  nations  which  have  accepted  the  in- 
vitation of  the  United  States  to  participate  in  the  Exposition  are : 
France,  Japan,  Canada,  Mexico,  Hayti,  Honduras,  San  Salvador, 


434  WORLD'S  INSURANCE  CONGRESS 

Cuba,  Porto  Rico,  Paraguay,  Ecuador,  Uraguay,  and  I  think  some 
others. 

Perhaps  the  greatest  feature  of  the  1915  Exposition  will  be  its 
congresses  and  conventions.  These  will  bring  to  San  Francisco 
the  greatest  thinkers  and  workers  of  all  nations  along  all  lines. 
Fraternal  organizations  and  scientific  societies  have  been  .so  im- 
pressed with  tlie  importance  of  these  conventions  that  they  have 
set  aside  $1,000,000  for  the  erection  of  an  auditorium  in  which  such 
meetings  will  be  held. 

A  few  days  prior  to  my  leaving  San  Francisco  to  bear  these  mes- 
sages from  Commissioner  Hathaway  and  President  Moore  of  the 
Exposition,  the  Mayor  of  San  Francisco  paid  the  city's  check  for 
$751,000  for  a  parcel  of  land  on  which  to  erect  an  auditorium  to 
cost  over  a  million  dollars.  It  is  in  this  magnificent  structure  that 
the  World's  Insurance  Congress  will  be  held. 

The  idea  of  a  World's  Insurance  Congress  being  interwoven 
with  other  great  events  is  most  opportune  on  account  of  the  im- 
portant position  which  insurance  occupies  in  the  advancement 
of  civilization  and  the  protection  of  mankind.  Insurance  is  at 
once  the  hand  maiden  of  commerce,  the  foundation  of  credits,  and 
the  protector  of  home,  wife  and  children.  It  is  peculiarly  appro- 
priate that  the  original  idea  of  the  World's  Insurance  Congress 
should  have  found  its  inception  in  the  convention  of  the  National 
Association  of  Underwriters,  a  body  of  men  whose  achievements, 
energy  and  ingenuity  are  at  one  and  the  same  time  the  dynamo, 
the  main  spring  and  creating  force  of  all  the  vast  assets  of  the 
various  life  insurance  companies  which  are  here  represented.  With- 
out the  agent  there  could  not  be  the  company. 

It  is  also  most  fitting  that  ]\Ir.  W.  L.  Hathaway  should  be  ap- 
pointed as  the  Commissioner  of  the  World's  Insurance  Congress, 
if  for  no  other  reason  than  that  his  entire  life's  work  and  energy 
have  been  devoted  to  the  education,  organization  and  concentration 
of  these  self-same  creative  forces.  AVith  what  success  is  well  known. 
In  the  world  of  insurance  his  record  is  written  in  the  national 
pages.  During  the  Armstrong  troublous  times  his  agency  force  re- 
mained intact,  his  business  increased,  and  this  fact  alone  will  show 
you  the  character  of  the  man  who  originated  and  is  now  chosen 
to  handle  the  affairs  of  the  World's  Insurance  Congress.  One 
of  the  most  important  appointments  made  by  the  authorities  of 
the  Exposition  since  its  inception,  and  the  very  first  appointment 
of  the  kind  which  has  been  made,  is  the  appointment  of  INlr.  W. 
L.  Hathaway,  granting  him  full  plenipotentiary  powers  and  full 
support  to  create  in  the  name  of  the  Exposition  the  necessary  or- 
ganization to  carry  out  the  project  of  the  World's  Insurance 
Congress. 

Since  the  idea  of  the  World's  Insurance  Congress  was  fii*st  ex- 
ploited at  the  convention  of  this  body  held  two  years  ago  at 
Detroit,  Mr.  Hathaway  has  given  largely  of  his  time,  his  ability 
and  his  money.    In  the  past  two  years  he  has  assumed  all  the  re- 


WORLD'S  INSURANCE  CONGRESS       435 

sponsibilities  for  tlie  undertaking,  and  single-handed  has  secured 
for  the  congress  ample  recognition  not  alone  in  the  United  States 
but  in  foreign  countries,  especially  England.  In  the  United  States 
the  World's  Insurance  Congress  has  been  endorsed  enthusiasti- 
cally by  the  leaders  in  insurance — Life  Fire,  Marine  and  miscel- 
laneous. 

The  first  publicity  given  to  the  Congress  after  Commissioner 
Hathaway  returned  from  the  Detroit  convention  was  gained  by 
his  signing  and  sending  through  the  mails  32,000  personal  letters. 
Out  of  this  grew  the  original  powerful  organization  embracing 
all  the  most  prominent  insurance  men  of  California  and  San  Fran- 
cisco. Of  this  body  Mr.  Hathaway  was  the  Chairman.  The  mes- 
sage given  to  the  world  by  this  association  was: 

"Panama-Pacific  World's  Insurance  Congress 
San  Francisco,  1915 

INVITES 

all  associations  or  societies,  either  of  a  business  or  professional  na- 
ture, whose  membership  derive  their  livelihood  from  the  commerce 
of  insurance,  to  hold  their  conventions  or  meetings  in  the  City  of 
San  Francisco  in  the  year  1915,  when  a  World's  Congi-ess  of  in- 
surance interests  will  be  held  separate  and  apart  from  the  regular 
annual  proceedings  of  the  various  associations  or  societies." 

Mr.  Hathaway  has  demonstrated  his  genius  as  an  organizer  in 
many  of  the  larger  matters  connected  with  the  civic  work  of  San 
Francisco  and  with  the  Exposition,  and  the  confidence  of  San 
Francisco  business  men  and  the  directorate  of  the  Exposition  has 
found  fitting  expression  in  the  creation  of  the  Commissionership, 
which  is  the  first  of  its  kind  to  be  formed  by  the  Exposition.  His 
reputation  for  ability  not  only  to  plan,  but  to  execute,  is  well  es- 
tablished in  the  leading  insurance  circles  of  this  country,  and  his 
appointment  to  this  office  was  the  one  thing  necessary  to  guarantee 
to  the  world  of  insurance  that  the  World's  Insurance  Congress 
will  be  organized  on  a  broad  basis,  and  that  it  will  be  a  credit  to 
San  Francisco,  the  Exposition  and  to  the  United  States;  that  its 
influence  for  good  will  be  boundless,  and  its  benefit  to  the  com- 
merce of  insurance  as  incalculable  as  it  will  be  lasting. 

Mr.  Hathaway 's  appointment  clothes  him  with  full  and  com- 
plete authority  for  the  carrying  out  of  his  great  ideas  as  they  de- 
velop ;  and  the  benefit  of  his  past  two  years '  application  and  study 
of  this  subject  will  now  become  available  and  invaluable.  He 
promulgates  a  fairly  well  defined  plan  of  organization  providing 
for  a  National  organization  which  is  to  continue  as  a  permanent 
body  after  the  Congress.  This  body  is  to  be  organized  with  the 
greatest  of  caution,  and  under  and  with  the  advice  and  direction 
of  the  most  able  minds  of  men  who  are  acknowledged  leaders  en- 
gaged in  the  business  of  insurance. 

After   careful   consideration   Commissioner   Hathaway  has  de- 


436  WORLD'S  INSURANCE  CONGRESS 

termined  that  the  first  step  is  the  organization  of  an  advisory- 
body  to  be  known  as  the  National  Council  of  the  World's  Insur- 
ance Congress,  with  the  prospect  that  a  meeting  of  this  will  be 
held  this  winter  in  New  York  to  perfect  the  organization  bj^  the 
election  of  officers  and  the  discussion  and  development  of  plans 
for  its  further  service.  In  the  selection  of  this  great  body  care 
will  be  taken  to  the  end  that  the  influences  may  be  balanced  to 
give  representation  to  the  best  interests  of  the  business,  and  accom- 
plish results  by  welding  together  in  concrete  form  the  entire  insur- 
ance power  of  the  country  for  such  purposes  as  their  general  in- 
terests may  determine  or  may  see  fit  to  counsel  in  connection  with 
any  particular  branch  of  insurance,  in  part  or  in  whole. 

Commissioner  Hathaway  deems  it  but  just,  and  is  proud  to  pre- 
sent first  to  the  National  Association  of  Life  Underwriters  the 
plans  of  the  World's  Insurance  Congress  as  partially  outlined  by 
me,  and  he  commissions  me  to  request  that  you  select  from  amongst 
your  members,  and  duly  authorize  such  selection,  one  to  serve  as 
the  very  first  member  of  the  National  Council  of  the  World's  In- 
surance Congress.  Thus  the  National  Association  of  Life  Under- 
writers is  the  first  unit  in  the  long  chain  between  the  Panama- 
Pacific  Exposition  and  the  World's  Insurance  Congress,  and  ^Ir. 
Hathaway  expressfy  desires  me  to  ask  that  the  link  in  this  chain 
be  made  especially  strong  and  firm. 

I  have  the  honor  to  bear  to  you  the  first  official  invitation  of  its 
kind  ever  issued  by  the  Exposition  authorities  to  a  like  convention, 
and  I  now  take  pleasure  in  presenting  you,  Mr.  President,  for  the 
association,  the  invitation  of  the  Panama-Pacific  International  Ex- 
position, bearing  the  Exposition's  seal  and  signed  by  the  Presi- 
dent, in  which  you  are  asked  to  hold  your  annual  convention  in 
the  City  of  San  Francisco  in  1915. 

I  bear  also  a  personal  letter  to  you  from  President  ]Moore  of  the 
Exposition,  and  a  personal  letter  from  Commissioner  Hathaway, 
which  I  have  delivered. 

I  now  suggest  that  immediate  action  be  taken  by  this  body  to 
nominate  for  the  distinguished  position  of  the  first  member  of  the 
National  Council  of  the  World's  Insurance  Congress  one  of  your 
members,  and  that  I  be  entrusted  with  the  credentials  in  order 
that  I  may  deliver  the  same  to  Commissioner  Hathaway. 

I  thank  you  for  your  attention.  I  trust  that  the  World's  In- 
surance Congress  and  Commissioner  Hathaway  will  receive  the 
fullest  measure  of  your  support  and  your  loyal  and  able  assist- 
ance, and  that  this  will  exceed  in  quantity  and  quality  even  my 
most  sanguine  expectations. 


WORLD'S  INSURANCE  CONGRESS  437 


THE  WORLD'S  INSURANCE  CONGRESS  AT  SAN 
FRANCISCO  IN  1915 

Address  Delivered  by  Commissioner  W.  L.   Hathaway 

Before  the  National  Association  of  Life   Underwriters,   Atlantic 
City,  September  18,  1913 

Insurance  underwriting  and  the  vast  interests  that  underwrit- 
ing has  created  with  its  numerous  occupations,  employing  the 
brains  and  energies  of  several  hundred  thousand  of  America's 
most  active  and  enlightened  citizens,  and  furnishing  the  main- 
spring of  stability  to  American  commerce,  enterprise  and  society, 
for  the  first  time  in  American  history  has  just  been  given  official 
recognition  in  a  great  National  undertaking,  authorized  by  act  of 
Congress  of  the  United  States.  For  the  Panama-Pacific  Interna- 
tional Exposition,  especially  charged  with  the  responsibility  of  ex- 
hibiting to  the  world  civilization's  advancement  in  all  that  benefits 
mankind,  has  given  to  insurance  the  same  recognition  as  to  the 
fine  arts,  manufactures,  agriculture,  machinery,  transportation  and 
the  other  arts  and  industries  by  creating  the  office  of  Commissioner 
of  Insurance,  the  incumbent  of  which  is  charged  with  the  respon- 
sibility of  issuing  national  and  international  invitations  to  partici- 
pate in  a  great  "World's  Insurance  Congress,"  which  will  convene 
in  San  Francisco  from  October  1  to  15  inclusive,  1915,  occupying 
over  one-twentieth  of  the  entire  period  of  the  Exposition's  life. 

During  former  expositions  there  has  existed  a  Commissioner 
for  each  and  all  of  the  other  arts  and  industries  through  which  the 
human  race  enjoyed  prosperity  and  happiness,  but  with  all  of  our 
vaunted  strength  and  stability  never  before  has  insurance  been 
so  recognized ;  and  that  this  recognition  is  a  forward  step  for  the 
interests  of  insurance  in  the  minds  of  the  American  people  has 
been  understood  and  appreciated  by  the  American  insurance  world. 
This  is  demonstrated  by  the  fact  that  since  the  creation  of  this 
Commission  the  Congress  has  been  recognized  by  resolutions,  and 
representatives  have  been  delegated  to  serve  upon  its  National 
Council  by  the  great  majority  of  the  big  national  associations  of 
a  business  and  professional  nature  having  to  do  with  all  branches 
of  insurance  activities,  and  prominent  among  those  associations  or 
societies  from  the  various  activities  of  life  insurance  that  have 
taken  this  official  action  are  our  own 

National  Association  of  Life  Underwriters, 

The  Association  of  Life  Insurance  Presidents, 

The  American  Life  Convention, 

The  Actuarial  Society  of  America, 

The  Life  Underwriters'  Association  of  Canada,  and 

The  Association  of  Life  Insurance  Medical  Directors  : 


438  AVORLD'S  INSURANCE  CONGRESS 

and  the  recognition  of  these  national  associations  having  to  do 
with  the  life  insurance  subject  has  been  greatly  fortified  by  numer- 
ous resolutions  from  State  organizations,  so  the  interest  from  the 
life  insurance  standpoint  can  be  considered  unanimous.  But  life 
insurance  is  not  alone  in  these  activities,  for  the  same  extensive 
recognition  has  been  granted  already  from  all  branches.  Fire, 
casualty,  and  all  the  various  forms  are  now  well  represented  in 
the  National  Council. 

So  the  "World's  Insurance  Congress  is  to-day  truly  a  National 
undertaking,  and  from  an  insurance  standpoint  doubly  so,  be- 
cause in  addition  to  its  being  clothed  with  all  authorit}^  conferred 
by  the  United  States  Government  upon  the  Panama-Pacific  Inter- 
national Exposition  to  extend  domestic  and  foreign  invitations,  it 
is  now  also  clothed  with  a  nation-wide  endorsement  by  the  Na- 
tional and  State  associations  representing  all  branches  of  the  in- 
surance business  and  its  allied  professions. 

So  with  this  authority  and  these  endorsements,  I  am  here  to-day 
to  extend  the  official  invitation,  National  and  international,  to 
the  insurance  world  at  large  to  participate  in  the  First  World's 
Insurance  Congress,  which  is  being  inaugurated  under  these  fa- 
vorable auspices. 

And,  Fellow  Members  of  the  National  Association  of  Life  Un- 
derwriters, I  am  proud  to  be  able  to  make  this  announcement  from 
your  platform,  for  it  was  at  our  Detroit  Convention  three  years 
ago  that  the  idea  of  holding  a  World's  Insurance  Congress  had  its 
inception ;  in  fact,  it  was  at  a  little  dinner  where  I  had  the  honor 
of  sitting  down  with  fourteen  representatives  of  the  insurance 
press  present  at  that  Convention  that  the  idea  of  this  Congress 
had  its  first  broad  discussion,  and  it  might  be  said  that  the  cour- 
age to  go  ahead  with  such  a  gigantic  undertaking  was  fostered 
into  existence  on  that  occasion  and  fortified  by  a  discussion  of  the 
subject  with  a  number  of  this  Convention's  leading  thinkers. 

I  went  on  to  New  York,  and  as  far  as  I  was  able  to  ascertain, 
found  that  the  opinion  was  unanimous  that  such  an  undertaking, 
if  carried  to  a  successful  conclusion,  contained  possibilities  of  im- 
measurable  good  to  the  business  of  underwriting  as  a  whole  in  this 
country.  It  was  recognized  that  a  closer  cooperation  of  the  tre- 
mendous influences  known  to  exist  in  connection  with  insurance  in- 
terests would  be  desirable,  not  only  for  those  engaged  in  it  as  a 
business  or  profession,  but  principally  for  the  insuring  public 
as  a  whole.  In  fact,  such  a  point  of  contact  had  long  been  contem- 
plated by  many  of  the  leading  thinkers,  but  the  logical  point  of 
organizing  activities  had  never  been  decided  upon.  I  argued  at 
that  time  that  the  part  which  insurance  played  succeeding  the 
great  San  Francisco  disaster,  making  it  possible  for  a  city  to  rise 
almost  magic-like  froni  the  ashes  of  its  great  fire,  created  an  un- 
derstanding of  the  benefits  of  insurance  sufficient  to  warTa7it  that 
re-created  City  in  constituting  itself  the  magnet  to  draw  together 
the  insurance  interests  of  this  National  for  such  benefits  as  a  closer 


WORLD'S  INSURANCE  CONGRESS  439 

cooperation  might  eventually  yield,  and  upon  my  return  to  San 
Francisco  I  argued  to  the  insurance  men  there  that  through  the 
natural  acts  of  Providence  an  obligation  had  been  created  for 
them  to  undertake  an  organization  that  would  eventually  confer 
back  upon  insurance  as  a  whole  some  of  the  benefits  which  insur- 
ance had  conferred  upon  us  as  a  City. 

And  now,  while  history  is  always  a  little  dry,  still  it  seems  nec- 
essary at  this  time,  when  extending  our  official  invitation  to  the 
world  of  insurance,  that  a  complete  understanding  of  each  step 
in  the  growth  and  development  of  this  organization  should  be 
given,  in  order  that  it  may  be  fully  understood  by  insurance  men 
who  had  passed  through  the  world's  greatest  crisis,  from  which 
insurance  had  relieved  them,  and  that  it  was  undertaken  in  a 
patriotic  sense  as  a  service  to  insurance  by  a  city  which  largely 
owed  its  existence  to  insurance  blessings;  and  while  at  that  time 
it  was  very  uncertain  whether  or  not  our  great  World's  Exposi- 
tion would  be  held  at  that  point,  still  I  argued  that  to  the  insur- 
ance world  the  rebuilt  San  Francisco  was  an  Exposition  far  ex- 
ceeding any  other  display  that  human  agencies  could  bring  to- 
gether; and  appearing  before  the  Life  Underwriters  Association 
of  San  Francisco  at  their  next  regular  monthly  meeting  after  my 
return,  on  October  14th,  1910,  I  introduced  the  following  resolu- 
tion, which  was  unanimously  adopted : 

"Resolved,  First.  That  the  San  Francisco  Life  Underwriters 
Association  declares  itself  in  favor  of  holding  a  World's  Congress 
of  Insurance  interests  in  this  city  in  the  year  1915 ; 

''Second.  That  the  President  be  directed  to  appoint  a  committee 
of  three  to  conduct  the  activities  of  organizing  for  this  under- 
taking ; 

"Third.  That  the  three  Committeemen  be  instructed  to  com- 
municate the  text  of  these  resolutions  to  other  associations  and 
prominent  men  connected  with  any  branch  of  insurance  business 
in  the  City  of  San  Francisco,  inviting  them  to  an  early  conference, 
with  the  object  of  a  complete  and  thorough  cooperation  of  all  in- 
surance men  in  this  city,  to  bring  about  the  world's  greatest  meet- 
ing of  insurance  interests; 

"Fourth.  That  the  above-mentioned  Committee  of  three  be  au- 
thorized and  empowered  in  the  name  of  this  Association,  to  proceed 
to  organize  with  the  Committeemen  from  other  insurance  inter- 
ests or  associations  for  the  purposes  and  activities  required  by  the 
joint  undertaking,  as  expressed  in  the  first  paragraph ; 

"Fifth.  That  the  Secretary  be  instructed  to  give  a  copy  of  these 
resolutions  to  the  press,  with  particular  reference  to  the  leading 
insurance  journals  published  throughout  the  United  States." 

And  the  fifth  paragraph  of  this  resolution  was  a  most  valuable 
one,  for  the  insurance  press  of  this  country  received  the  idea  most 
kindly.  In  fact,  I  can  say  with  much  reason  that  the  members 
of  the  insurance  press  have  made  this  Congress  possible,  and  to 
me  this  seems  natural,  because  they,  of  all  the  other  vast  insur- 


440  AYORLD'S  INSURANCE  CONGRESS 

ance  fraternity,  occupy  the  position  that  has  familiarized  them 
with  the  many  powerful  bodies  that  only  waited  to  be  brought 
into  closer  relations  to  create  an  intiuence,  and  be  able  to  cope  with 
many  problems  that  have  proven  difficult  to  the  separate  organiza- 
tions; so  I  suppose  the  reason  that  they  encouraged  with  such 
liberal  publicity  each  step  in  our  undertaking  was  that  fact. 

The  Committee  authorized  by  these  resolutions  consisted  of  W. 
L.  Hathaway,  Chairman;  Geo.  B.  Scott  and  John  Landers,  to 
which  Wm.  J.  Bell,  as  President  of  the  San  Francisco  Association, 
was  added  by  our  special  request.  This  Committee  of  four  under- 
took a  campaign  among  the  leading  insurance  men  of  San  Fran- 
cisco to  perfect  an  organization  in  keeping  with  these  resolutions, 
the  details  and  work  of  which  were  carried  forward  with  such 
energy  that  within  a  short  time  they  were  able  to  hold  their  first 
meeting  with  fifty-odd  members  present,  who  had  signed  an  appli- 
cation for  membership,  which  w^as  in  fact  a  pledge  of  their  influ- 
ence and  service;  and  at  that  meeting  the  following  resolutions 
were  adopted : 

*  *  FIRST 

' '  The  name  of  this  organization  shall  be  Panama-Pacific  World 's 
Insurance  Congress, 

' '  SECOND 

"The  object  of  its  organization  shall  be — 

"First.  To  conduct  activities  calculated  to  influence  all  associ- 
ations, societies  and  business  organizations  having  an  interest  in 
the  subject  of  insurance  in  any  of  its  branches,  to  hold  their  con- 
ventions or  meetings  during  the  year  1915  in  the  City  and  County 
of  San  Francisco. 

''Second.  To  conduct  activities  and  carry  out  such  plans  as 
may  be  found  necessary  and  expedient  to  bring  about  a  great 
World's  Insurance  Congress  during  the  time  that  the  various  so- 
cieties, associations  and  organizations  are  separately  holding  their 
conventions  or  meetings  in  this  city  in  the  year  1915. 

"Third.  To  conduct  activities  calculated  to  influence  all  indi- 
viduals throughout  the  world  who  are  engaged  or  interested  in 
any  of  the  branches  of  insurance,  to  a  favorable  consideration  of 
this  World's  Insurance  Congress,  and  particularly  with  regard  to 
getting  their  personal  pledges  to  attend,  and  their  influence  upon 
others  to  do  so. 

"Fourth.  Permitting  such  other  enlargement  of  the  scope  of 
activities  as  developments  may  require  and  the  organization  may 
adopt. 

* '  THIRD 

"The  existence  of  this  Association  shall  be  limited  to  the  time 
necessary  to  promote  and  carry  out  the  existence  of  said  World's 
Congress  of  insurance  interests,  and  the  winding  up  of  the  details 
connected  with  its  conduct." 

This  set  of  resolutions  was  received  with  the  same  spirit  of  un- 
derstanding by  the  insurance  press,  an  understanding,  in  fact, 
which  I  now  believe  far  exceeded  tliat  of  the  promoters. 


WORLD'S  INSURANCE  CONGRESS  441 

I  was  again  elected  Chairman  of  this  new  organization,  repre- 
senting every  prominent  insurance  interest  in  California,  and  in 
order  that  a  further  understanding  of  the  objects  upon  which  we 
were  embarked  may  be  had,  I  quote  you  the  following  paragraph, 
which  was  printed  at  the  head  of  our  first  stationery: 

"Panama-Pacific  World's  Insurance  Congress 
San  Francisco,  *1915 

INVITES 

all  associations  or  societies,  either  of  a  business  or  professional  na- 
ture, whose  membership  derive  their  livelihood  from  the  commerce 
of  insurance,  to  hold  their  conventions  or  meetings  in  the  City  of 
San  Francisco  in  the  year  1915,  when  a  World's  Congress  of  in- 
surance interests  will  be  held  separate  and  apart  from  the  regular 
annual  proceedings  of  the  various  associations  or  societies." 

I  quote  this  here  for  the  same  reason  it  was  originally  used — 
that  all  associations  might  thoroughly  understand  that  our  under- 
taking did  not  calculate  in  any  way  to  interfere  with  existing  or- 
ganizations, but  simply  to  draw  them  a  little  closer  together  for 
such  benefits  as  a  mutual  cooperation  might  yield ;  and  to  the  text 
of  that  paragraph  which  headed  our  letters  we  have  always  held; 
following,  in  fact,  the  basic  principle  upon  which  insurance  itself 
is  based,  clubbing  together,  as  it  were,  to  give  and  receive  that 
mutual  protection  which  a  single  individual  cannot  enjoy,  which, 
upon  a  little  thought,  I  am  sure  you  will  agree,  applies  with  equal 
force  to  the  single  association  in  this  day  of  advanced  insurance 
activities,  and  the  many  problems  with  which  insurance  has  to 
cope.  In  all  of  these  the  various  organizations  are  equally  in- 
terested, and  the  solving  of  them  needs  their  close  cooperative 
influences. 

I  was  rather  proud  of  the  dignity  of  serving  as  Chairman  of 
this  new  association,  the  membership  of  Avhich  Avas  made  up  very 
largely  of  men  whose  names  stood  among  the  most  prominent  in 
our  State,  so  I  began  rather  an  ambitious  campaign  of  correspond- 
ence, and  in  the  next  few  months  thirty-two  thousand  letters 
went  out  to  thirty-thousand  insurance  men  throughout  the 
world.  It  is  true  that  the  letter  was  multigraphed,  but  the  name 
of  the  party  to  whom  the  letter  was  sent  was  filled  in  at  the  head 
of  each  one,  and  I  personally  signed  each  and  every  one  of  them 
as  Chairman. 

That  letter  also  claims  a  place  in  this  paper,  as  it,  too,  points 
out  the  objects  for  which  we  are  working,  and  I  quote  it  as 
follows : 

"We  earnestly  invite  your  interest  and  active  cooperation  in  the 
above  undertaking,  which  calculates  to  bring  together  for  the  first 
time  in  the  world's  history  all  the  various  interests  engaged  in 
the  commerce  of  insurance  in  all  its  branches. 


442  WORLD'S  INSURANCE  CONGRESS 

' '  The  movement  has  already  received  such  extensive  endorsement 
as  to  justify  our  belief  in  a  complete  attendance. 

"We  realize,  however,  that  the  beneficial  objects  to  be  accom- 
plished for  the  business  by  such  a  meeting  will  depend  largely 
upon  the  interest  and  active  cooperation  of  men  like  yourself,  who 
occupy  prominent  positions  in  the  insurance  world." 

Now  while  a  surprisingly  large  per  cent  of  these  letters  brought 
replies,  they  developed  one  most  interesting  and  gratifying  fact, 
and  that  was  that  it  was  the  men  occupying  positions  of  leading  in- 
fluence who  had  time  to  read  and  answer  that  letter.  Some  of 
them  wrote  cautiously  and  inquiringly,  but  a  careful  check  of 
American  insurance  registers  showed  that  those  with  the  reins  of 
influence  were  interested,  and  further  correspondence  with  many 
well  known  thinkers  developed  the  fact  that  they  had  long  sought 
a  means  of  bringing  the  many  separate  influences  into  closer  co- 
operation for  such  purposes  as  might  be  mutually  beneficial. 

However,  while  I  enjoyed  as  Chairman  of  that  organization  an 
extensive  correspondence  with  men  of  prominence  in  the  business, 
still  the  interest  could  not  be  termed  a  world-wide  or  even  a 
thoroughly  National  one;  so  in  looking  about  for  a  new  mode  of 
attack  we  devised  the  Christmas  and  New  Year  Greeting  Card, 
which  was  at  the  same  time  an  invitation  to  our  Congress,  and 
during  the  holidays  of  1911  more  than  one  hundred  thousand  of 
these  cards  went  from  the  insurance  fraternity  of  San  Francisco 
literally  around  the  world,  to  their  friends  and  correspondents, 
and  as  many  of  these  cards  contained  personal  messages,  they 
brought  another  flood  of  correspondence,  and  we  began  to  realize 
that  we  had  awakened  a  lot  of  interest  in  a  big  possibilit3^  But 
under  the  auspices  even  of  the  entire  insurance  influences  of  our 
city,  we  scarcely  attained  sufficient  National  dignity  to  hope  for 
many  acceptances  of  an  international  character,  and  we  began  to 
be  bothered,  until  one  day,  while  attending  a  committee  meeting 
of  the  Panama-Pacific  International  Exposition,  I  heard  Presi- 
dent Charles  C.  Moore  say  in  the  course  of  his  remarks  that  the 
Exposition  was  authorized  by  an  act  of  Congress  especially  to 
confer  upon  mankind  benefits  in  the  domain  of  thought  and  com- 
merce, and  that  his  invitation  was  calculated  to  carry  with  it  the 
National  dignity  of  the  entire  American  people.  That  settled  it. 
The  next  day  found  me  in  his  office  asking  that  he  extend  the 
cloak  of  National  dignity  to  the  World's  Insurance  Congress,  and 
telling  him  that  its  success  meant  benefits  to  the  entire  insuring 
American  public.  The  result  was  that  he  told  me  to  submit  it 
in  writing  in  such  form  as  to  show  that  the  membci-ship  of  my 
present  organization  coincided  with  my  views,  and  that  the  move- 
ment would  continue  to  receive  the  support  of  the  membership 
should  the  Exposition  recognize  it,  and  that  Avhen  it  had  it  in  this 
form,  he  would  consider  it.  So  on  December  22nd,  1911  (in  the 
midst  of  our  postal  campaign)  I  presented  him  with  the  following 
petition: 


WORLD'S  INSURANCE  CONGRl 


443 


San  Francisco,  December  22nd,  1911. 

Chas.  C.  Moore,  Esq.,  President, 
Panama-Pacific  International  Exposition, 
San  Francisco. 

Dear  Sir: 

As  members  of  the  above  temporary  organization,  we  the  un- 
dersigned join  in  the  request  that  you  appoint  a  committee  made 
up  wholly  of  men  associated  with  the  insurance  business,  who  as 
a  part  of  the  Fair  Association  will  be  authorized  to  negotiate  with 
the  insurance  world,  and  in  the  broadest  sense  carry  to  a  successful 
issue  this  undertaking,  which  has  now  reached  such  proportions 
as  to  justify  and  require  such  official  action. 

We  further,  by  this  act,  agree  that  upon  the  appointment  and 
formation  of  the  committee  appointed  by  you,  this  temporary  or- 
ganization shall  cease  to  exist  as  such ;  and  that  all  papers  and 
correspondence  in  the  temporary  chairman's  possession  be  turned 
over  to  the  chairman  of  your  committee ;  and  that  we  will  each 
of  us  take  such  active  interest  in  the  work  of  said  committee  as 
we  may  be  appointed  to  or  called  upon  to  cooperate  in  it. 

Yours  truly. 


E.  C.  Cooper 
Warren  R.  Porter 

E.  F.  Green 
Geo.  H.  Tyson 
W,  L.  Hathaway 
Wm.  J.  Dutton 
J.  B.  Levison 
Rolla  V.  Watt 
Robt.  W.  Neal,  Ed. 
J.  A.  Carey,  Pub. 
G.  Earle  Kelly 
John  C.  Piver,  Pub. 
Edw.  H.  Bacon,  Ed. 
W.  H.  Matson 
Chas.  J.  Bosworth 
Clarence  F.  Briggs 
H.  V.  D.  Johns 
Jas.  H.  Borland 
John  Landers 

F.  J.  Johnson 
A.  M.  Shields 

E.  H.  Hart 

F.  E.  DeGroat 
Vail  &  Eldridge 
Wm.  J.  Bell 
Jas.  W.  Moyles 
J.  S.  Osborne 
Paul  M.  Nippert 
John  H.  Robertson 
F.  A.  Stearns 
John  A.  Koster 


Bertheau  &  Bertheau 
Henry  J.  Crocker 
T.  L.  Miller 
Louis  Rosenthal 
W.  0.  Wayman 
C.  Mason  Kinne 
W.  S.  Davis 
Julian   Sonntag 
E.  H.  L.  Gregory 
T.  H.  Harris 
W.  E.  Dean 
Frank  L.  Gilbert 
Henry  S.  Dunn 
Geo.  I.  Cochran 
F;dw.   Parrish 
A.  W.  Thornton 
Bernard  Faymonville 
Edw.  Brown  &  Sons 
Chas.   Christensen 
R.  L.  Stephenson 
Geo.  C.  Farrell 
Field  &  Cramer 
W.  B.  Wentz 
Geo.  W.  Dornin 
Frank  J.  Devlin 
Whitney  Palace 
J.  C.  Johnson 
A.  G.  Sanderson 
R.  W.  Osborn 
Goo.  B.  Scott 
Kilgarif  &  Beaver 


444       WORLD'S  INSURANCE  CONGRESS 

John  H.  Stevens  O.  0.  Orr 

Jas.  F.  Cobb  Co.  A.  S.  Holman 

Joy  Lichtenstein  Carl  Henry 

]\Iarshal  A.  Frank  A.  K.  P.  Harmon 

Smith,  Thomas  &  Thomas  J.  E.  Betts 

E.  T.  Niebling  J.  C.  deKolty 

Geo.  W.  Brooks  E.  W.  McCarthy 

H.  Durbrow  Fred  Stolp 

W.  A.  Wann  D.  M.  Gedge,  M.  D. 
A.  H.  Mowbray 

You  will  note  that  there  are  eighty-two  signatures  to  the  above 
petition,  and  one  familiar  with  California  names  will  find  many 
in  this  list  who  are  prominent  in  all  the  activities  of  our  State,  as 
well  as  the  leading  names  in  the  insurance  world  of  California. 

Well,  President  Moore  did  consider  it,  and  he  investigated  it, 
and  he  had  others  do  so,  for  while  he  is  a  man  of  quick  perception 
and  known  as  a  constructive  genius,  he  is  careful  that  the  Panama- 
Pacific  International  Exposition  shall  further  only  such  undertak- 
ings as  conform  to  the  high  ideals  that  the  National  Government 
chartered  it  to  perform,  so  I  had  a  long  wait  and  many  con- 
ferences with  committees  and  officials,  all  of  whom  wanted  to  see 
and  to  know  that  the  Congress  merited  being  taken  in  as  a  part 
of  the  National  undertaking;  but  when  the  announcement  finally 
came  in  October  of  1912,  it  showed  that  we  had  profited  by  the 
delay  and  by  the  constructive  genius  of  President  Moore,  for  he 
ruled  that  the  undertaking  warranted  more  than  mere  commit- 
tees, and  that  insurance  itself  warranted  recognition  by  the  Ex- 
position as  a  potent  factor  in  civilization,  and  should  be  assigned 
official  representation  in  the  Exposition  staff  by  creating  the  ofBce 
of  "Commissioner  of  Insurance,"  with  the  powers,  authorities 
and  responsibilities  usually  vested  in  such  Commissioners — an  of- 
fice that  was  tendered  me  with  a  command  to  take  it,  and  nominate 
my  committees  for  confirmation  of  the  Board  of  Directors  and  ap- 
pointment by  the  President. 

So  two  years  were  spent  promoting  public  interest,  gathering  in- 
formation, getting  opinions  and  criticisms,  and  finally  clothing  the 
undertaking  with  National  dignity  through  the  official  recognition 
of  the  Panama-Pacific  International  Exposition. 

Since  the  creation  of  this  office  of  Commissioner  of  Insurance, 
and  acting  in  that  capacity,  organization  has  proceeded  on  a  Na- 
tional basis,  with  the  results  of  the  wide-spread  endorsement  men- 
tioned, and  the  cooperation  of  men  officially  assigned  b.v  these  va- 
rious associations  as  part  of  the  undertaking. 

Now  as  this  goes  out  to  the  insurance  world  as  a  combination 
of  our  official  invitation  and  a  brief  resume  of  the  important 
steps  in  its  construction,  it  seems  well  to  add  a  brief  outline  of  the 
form  of  organization  that  is  being  brought  into  existence  to  care 
for  an  underaking  of  such  gigantic  proportions. 


WORLD'S  INSURANCE  CONGRESS  445 

First  there  is  an  Executive  Committee  of  five,  made  up  as  fol- 
lows: 

Wm.  J.  Button,  Chairman,  President  Fireman's  Fund 
Insurance  Company; 

George  I.  Cochran,  President  Pacific  Mutual  Life  In 
surance  Company; 

Hon.  E.  C.  Cooper,  State  Insurance  Commissioner; 

"W.  E.  Dean,  President,  California  Insurance  Co. ; 

F.  F.  Taylor,  5th  Vice  President,  Metropolitan  Life  In- 
surance Co. ; 

all  Californians,  for  while  Mr.  Taylor  lives  in  New  York,  still  he 
won  his  spurs  in  San  Francisco  during  her  reconstructive  period. 
Following  this  are  the  Committees  on  Participation  and  Attend- 
ance, reaching  into  every  branch  and  profession  of  the  business, 
and  as  at  present  constituted  are  as  follows: 

Committees  on  Participatimi  and  AttendoMce 

Accident  Insurance,  A.  S.  Holman,  Chairman,  San  Francisco. 

Actuaries,  John  F.  Roche,  Chairman,  New  York  City. 

Automobile  Insurance,  Geo.  Chalmers,  Chairman,  San  Francisco. 

Domestic  Fire  Insurance  Companies,  Bernard  Faymonville, 
Chairman,  San  Francisco. 

Employers'  Liability  Insurance,  Chairman  not  yet  selected. 

Foreign  Fire  Insurance  Companies,  RoUa  V.  Watt,  Chairman, 
San  Francisco. 

Local  Fire  Companies  and  General  Agencies,  Tom  C.  Grant, 
Chairman,  San  Francisco. 

Industrial  Life  Insurance,  Geo.  B.  Scott,  Chairman,  San  Fran- 
cisco. 

Insurance  Brokers,  Wm.  H.  LaBoyteaux,  Chairman,  San  Fran- 
cisco. 

Life  Companies  op  American  Life  Convention,  Hon.  Warren  R. 
Porter,  Chairman,  San  Francisco. 

Life  Insurance  Companies,  E.  H.  Lestock  Gregory,  Chairman, 
San  Francisco. 

Life  Insurance  IMedical  Directors  and  Examiners,  Dr.  W.  R. 
Cluness,  Jr.,  Chairman,  San  Francisco. 

Marine  Insurance,  J.  B.  Levison,  Chairman,  San  Francisco. 

Miscellaneous  Insurance,  John  C.  Piver,  Chairman,  San  Fran- 
cisco. 

Surety  Insurance,  J.  H.  Borland,  Chairman,  San  Francisco. 

These  Committees  on  Participation  and  Attendance  are  also 
largely  made  up  of  Californians,  for  the  reason  that  their  work  will 
be  mostly  that  of  exploitation,  a  work  that  could  best  be  carried 
out  from  that  end  of  the  line. 


446  WORLD'S  INSURANCE  CONGRESS 

Then  in  addition  to  this,  there  is  a  Committee  on  Entertainment 
which  is  gradually  being  constructed,  and  this  you  can  readily  un- 
derstand will  be  one  of  the  most  important  committees,  especially 
during  the  Exposition  year.  I  can  assure  that  this  Committee  will 
be  efficient,  and  will  maintain  San  Francisco's  reputation  for  hos- 
pitality. 

From  this  point  out,  however,  the  organization  assumes  a  Na- 
tional scope,  and  the  creating  of  the  National  Council,  with  a  rep- 
resentative from  each  National  association  in  any  way  affiliated 
with  insurance  activities,  is  the  basis  of  this  National  organization. 
It  is  gratifying  to  announce  that  this  National  Council,  by  the 
acts  of  these  influential  associations,  has  sufficient  members  and 
covers  a  sufficient  part  of  the  entire  insurance  field,  to  consider 
that  it  represents  by  far  the  larger  portion  of  the  entire  National 
insurance  influence,  and,  in  consequence,  the  National  Council  is 
now  sufficiently  organized  to  warrant  its  activities  upon  the  as- 
sumption that  it  represents  the  insurance  interests  of  this  Nation. 
Consequently  from  this  time  on  each  step  in  the  Congress  move- 
ment will  be  acted  upon  by  that  body  in  a  more  formal,  official 
manner  than  heretofore,  for  while  I  have  enjoyed  the  personal 
advice  of  a  large  number  of  them  through  correspondence,  still  up 
to  the  present  time  they  have  not  been  organized  into  an  official 
body  and  committees  to  more  directly  advise  our  progress. 

I  am  constantly  being  asked  what  we  propose  to  accomplish  at 
this  Congress,  and  I  have  always  answered  that  the  subject  and  the 
possibilities  were  entirely  too  great  for  any  one  man  to  do  any  defi- 
nite predicting  as  to  what  would  be  accomplished,  but  that  I  be- 
lieved that  every  man  engaged  in  insurance  activities  believed  and 
understood  that  mutual  cooperation  from  its  most  rudimentary  to 
its  most  advanced  stages  w^as  beneficial  to  the  interests  or  individ- 
uals cooperating,  and  that  the  history  of  insurance  pointed  to  the 
fact  that  the  time  had  arrived,  in  fact,  seemed  past  due,  when  a 
closer  drawing  together  of  these  various  influences  was  absolutely 
necessary  to  the  best  interests  of  insurance  in  this  country ;  and  I 
do  not  attempt  to  go  into  detail  as  to  wdiat  will  be  the  outcome,  for 
I  do  not  believe  that  any  man  to-day  could  predict  Avhat  the  out- 
come will  be  through  such  an  organization  once  that  the  benefits 
of  getting  together  are  beginning  to  be  realized.  I  do  not  believe 
that  it  could  be  predicted  to-day  any  more  than  the  organizers  and 
promoters  of  one  of  our  big  insurance  companies  over  half  a  cen- 
tury ago  could  have  predicted  the  extent  of  the  benefits  of  the  or- 
ganizations which  they  were  just  bringing  into  existence. 

So  the  objects,  as  far  as  we  care  to  predict  them,  are  mutual  co- 
operation, getting  together  for  such  benefits  as  time  may  point  the 
way  of  accomplishing,  making  a  start,  in  fact,  just  as  the  first 
insurers  made  a  start  when  they  banded  themselves  together  and 
laid  the  foundation  of  one  of  these  great  insurance  companies.  I 
can  but  say  that  I  believe  the  undertaking  comes  into  life  under 
favorable  auspices  with  an  example  before  it  of  what  insurance  has 


WORLD'S  INSURANCE  CONGRESS  447 

accomplished  in  the  re-created  San  Francisco,  the  place  where  the 
first  great  Congress  is  to  convene,  that  will  be  inspiring  to  every 
man  who  attends,  for  besides  what  the  eye  will  see  in  the  recon- 
structed city,  there  will  be  encountered  a  spirit  among  San  Fran- 
cisco insurance  men  of  almost  reverence  for  the  institution  of  insur- 
ance, which  was  created  in  the  day  of  their  adversity,  and  so 
deeply  set  in  their  hearts  that  it  will  be  felt  and  understood  by 
the  visitors,  no  matter  from  what  part  of  the  world  they  may  come. 

Tentatively  speaking,  however,  and  based  upon  the  interest  that 
has  been  evinced  through  wide  correspondence  that  I  have  had 
with  leading  insurance  influence,  I  can  state  that  three  of  the  big 
subjects  that  will  occupy  much  of  the  attention  of  the  Congress 
will  be  first,  Fire  Prevention,  for  which  a  Committee  has  already 
been  started  on  a  National  basis,  with  Mr.  Garner  Curran,  of  the 
Inmrance  and  Investment  News  of  Los  Angeles,  who  is  an  expert 
upon  this  subject,  as  Chairman.  Then  an  extensive  correspondence 
has  been  had  with  those  interested  in  Accident  Prevention,  which 
develops  the  fact  that  they  are  already  organized  on  a  broad  na- 
tional basis  upon  this  subject,  and  the  interest  which  the  experts 
in  this  domain  have  evinced  in  the  Congress  warrants  me  in  pre- 
dicting that  it  will  also  occupy  a  position  of  great  importance  in 
the  activities  of  the  Congress. 

Then  in  the  domain  of  life  insurance,  we  come  to  a  subject  which 
is  already  claiming  the  attention  of  all  of  us  who  think  of  the 
future  of  the  business,  and  that  is  the  subject  of  Health  Conser- 
vation, which  I  find  is  receiving  deep  attention,  not  only  on  behalf 
of  many  of  the  leading  officials  connected  with  life  insurance,  but 
on  behalf  of  educators  who  evince  a  willingness  to  join  with  life 
insurance  men  in  any  activities  or  research  that  will  educate  the 
public  upon  this  subject.  That  Health  Conservation  will  be  one  oi 
the  big  subjects,  there  can  be  no  question. 

So,  broadly  speaking,  these  three  subjects  may  be  considered  as 
already  having  become  a  part  of  the  Congress  movement,  and  as 
they  are  subjects  in  which  the  public  as  a  whole  is  interested,  and 
through  them  those  engaged  in  insurance  are  performing  a  public 
service  in  promoting,  they  will  prove  from  a  broad  public  stand- 
point most  attractive  features,  to  which  I  hope  we  will  be  able  to 
add  something  to  the  big  work  already  being  accomplished  in  those 
directions. 

There  are,  of  course,  other  subjects  in  which  we  as  insurance 
men  see  deep  practical  significance,  which  will  doubtless  claim 
serious  attention,  and  through  them  the  insurance  interests  as  a 
whole  will  find  the  most  practical  reasons  for  this  Congress  and 
I  hope  future  cooperation;  and  while  I  have  had  extensive  corre- 
spondence regarding  many  of  them  they  could  only  be  spoken  of 
here  in  a  tentative  way,  as  the  extent  of  the  consideration  given 
all  such  matters  will  be  proper  subjects  for  the  National  Council 
to  determine,  and  there  readily  occur  to  every  one  of  us  present 
subjects  in  connection  with  the  agency  end  of  the  business  which 


448  WORLD'S  INSURANCE  CONGRESS 

could  profitably  command  the  attention  of  such  a  Congress.  That 
these  subjects  will  be  considered  I  do  not  doubt,  but  it  is  well  to 
understand  that  these  and  all  kindred  subjects  will  be  considered 
just  to  the  extent  that  active  members  of  this  and  similar  organi- 
zations exert  their  claims  for  consideration  through  the  National 
Council,  and  all  subjects  of  this  or  kindred  natures  addressed  to 
me  as  Commissioner  will  be  referred  to  the  proper  Committees  of 
that  body  for  full  consideration  of  such  claims  as  they  may  have ; 
and  as  we  will  soon  have  an  executive  secretary  installed  handling 
the  details  of  this  work,  I  hope  that  every  man  who  feels  an  inter- 
est in  any  particular  subject  connected  with  the  business  which  he 
thinks  merits  consideration  at  such  a  Congress  will  bring  it  before 
us  with  all  the  influences  which  the  subject  has  behind  it. 

A  vast  number  of  matters  have  transpired  in  connection  with 
this  movement  that  cannot  be  included  in  this  report,  which,  in 
a  measure,  is  one  dealing  only  with  the  necessary  outline  of  the 
movement  development,  but  it  would  not  be  complete  to  close  it 
without  mention  of  the  action  taken  by  the  European  International 
Bureau  of  Insurance  at  its  annual  meeting  in  Paris  on  July  5th 
last,  when  it  passed  a  resolution  to  the  effect  that  in  view  of  the 
World's  Insurance  Congress  to  be  held  in  San  Francisco  in  1915, 
the  bureau  decided  not  to  hold  its  regular  congress  in  that  year, 
but  to  recommend  to  the  associations  of  which  it  is  constituted  that 
they  should  bring  this  World 's  Insurance  Congress  to  the  attention 
of  their  members  with  a  recommendation  that  they  participate  in  it 
instead  of  the  regular  European  meetings  that  year,  which  shows 
that  the  European  world  is  ready  for  this  invitation,  and,  while 
it  will  be  sent  to  each  source  in  a  more  formal  manner,  Ave  hope 
that  they,  together  with  all  American  interests,  will  take  this  as 
an  advance  notice  and  prepare  for  their  part  in  it. 


EQUALITY 

An  Original  Poem 

By  Edwin  W.  DeLeon 

(Dedicated  to  the  World's  Insurance  Congress  of  the  Panama- 
Pacific  International  Exposition,  San  Francisco,  1915.) 

Our  Nation 's  fathers,  with  inspired  vision  clear, 

This  country's  creed  ordained  in  lofty  wisdom  rare; 

All  men  created  free  and  equal  are, 

Proclaimed  they  to  all  peoples,  near  and  far; 

They  spake  in  truth,  defining  nature's  plan, 

Applied  alike  to  all  the  sons  of  man; 

On  rich  and  poor,  as  well  on  low  and  high, 


WORLD'S  INSURANCE  CONGRESS  449 

God 's  radiant  sun  bursts  warmly  from  the  sky ; 

The  freshening  rains  impartially  bestow 

Their  blessings  great  on  mortals  here  below ; 

The  tempering  breeze,  or  tempest's  cruel  roar, 

Knock  both  at  mansion  and  at  cottage  door; 

Majestic  tower  the  mountain's  snow  clad  peaks, 

In  solemn  state  awaiting  him  who  seeks; 

The  sloping  hills,  the  valleys  verdent  hued, 

By  owner  or  by  peasant  may  be  viewed ; 

Grim  ocean's  tides,  with  ceaseless  ebb  and  flow, 

Provide  to  all  mankind  a  way  to  go ; 

Each  changing  season,  with  Divine  Intent, 

To  benefit  humanity  alike,  is  meant ; 

And  e'en  the  air  we  breathe,  the  flowers'  perfume  sensed, 

In  nature's  lavish  measure  are  equally  dispensed. 


EDITORIALS  FROM  SAN  FRANCISCO  NEWSPAPERS 
Insurance  Congress  Will  Benefit  All 
(From  the  San  Francisco  Call  and  Post) 

The  Call  and  Post  has  published  a  great  deal  of  comment  on  the 
benefits  of  insurance.  People  have  come  to  take  fire  insurance 
for  granted,  and  thoughtful  persons  in  particular  have  adopted 
that  attitude  toward  life  insurance,  which  is  just  as  essential  for 
a  family's  protection  as  fire  insurance  is  wise  for  the  protection 
of  property  against  unavoidable  loss.  In  fact,  the  unselfish  man, 
the  man  who  loves  his  family,  will  think  first  of  life  insurance. 

However,  we  are  not  to  discuss  the  merits  of  those  forms  of  pro- 
testion  at  this  time,  but  to  call  the  attention  of  San  Francisco 
the  fact  that  in  October  the  World's  Insurance  Congress  will  be 
held  at  the  Exposition,  This  will  be  the  first  time  that  an  insur- 
ance congress  has  ever  been  held  at  a  world's  fair.  We  are  confi- 
dent that  at  every  succeeding  exposition  of  international  scope 
the  insurance  movement  will  be  represented  in  increasing  impor- 
tance. 

The  program  for  the  October  congress  has  been  prepared  in 
outline  and  promises  unusually  interesting  discussions  of  topics 
of  benefit  not  only  to  the  commercial  aspect  of  the  companies,  not 
only  helpful  to  the  great  masses  of  people  who  as  policyholders  are 
already  participants  in  the  benefits  of  insurance  companies,  but  to 
the  public  at  large.  For  the  insurance  companies  are  working  for 
the  improvement  of  living  conditions,  for  the  lessening  of  the  fire 
hazard,  for  the  extension  of  the  period  of  life  and  for  the  better 
protection  of  working  men  and  women.  And  with  the  progress 
of  these  reforms  the  whole  people  will  be  benefited,  for  the  eondi- 


450       WORLD'S  INSURANCE  CONGRESS 

tion  of  one  cannot  be  improved  without  his  neighbor  and  his  fellow- 
worker  participating  in  the  greater  security  that  is  given. 

World's  Insurance  Congress  Hailed  as  Exposition's  Best 
(From  the  San  Francisco  Chronicle) 

The  World's  Insurance  Congress  Avill  convene  in  this  city  on 
October  4th  and  continue  in  session  for  two  weeks.  The  sessions 
of  the  first  six  days  and  the  eleventh  day  will  be  held  in  the  Civic 
Auditorium,  while  those  of  the  seventh,  eighth,  ninth  and  tenth 
days  will  be  at  the  Court  of  the  Universe  on  the  Exposition 
Grounds. 

No  more  important  convention  has  been,  or  will  be,  held  in 
this  city  this  year.  The  insurance  companies  are  the  only  impor- 
tant organizations  of  the  world  which  have  at  their  disposal  enor- 
mous means  and  prodigious  influence,  and  which  make  money  for 
their  stockholders  by  preventing  loss  of  any  kind. 

These  organizations  may  be  considered  conservationists  for  hire 
on  a  scale  which  embraces  all  forms  of  human  activity  and  all 
places  of  human  existence.  The  greater  the  freedom  from  loss 
to  individuals,  the  larger  the  dividends  to  the  stock-holders  of  in- 
surance companies. 

To  the  problems  of  safety,  those  who  will  meet  in  this  congress 
will  bring  the  highest  intelligence,  the  wisest  experience,  and  the 
greatest  operating  fund  that  can  possibly  be  concentrated  upon 
them. 

It  is  now  possible  for  a  reasonable  premium  to  insure  oneself 
against  any  kind  of  loss.  With  fire  insurance,  marine  insurance, 
life  insurance,  and  accident  insurance  we  are  all  familiar.  In 
fact,  as  to  industrial  accident  insurance,  every  resident  of  Califor- 
nia is  an  underwriter,  and,  if  wise,  is  also  one  of  the  insured. 
He  is  an  underwriter  anyhow. 

In  recent  years  those  engaged  in  insurance  have  come  to  realize 
that  social  conditions  have  decided  effect  on  the  amount  of  losses, 
and  therefore  upon  the  profits  of  underwriting. 

The  life  insurance  companies  have  a  vital  interest  in  the  public 
health,  and  some  of  them  carry  on  systematic  welfare  work  among 
their  policyholders,  not  at  all  as  a  charity,  but  as  a  producer  of 
dividends.  Insurance  companies  make  most  money  when  the  com- 
munities which  they  serve  are  orderly,  healthy,  prosperous  and 
contented,  and  as  a  matter  of  business  they  promote  those  con- 
ditions wherever  they  operate. 

It  is  these  broader  aspects  of  insurance  that  will  be  presented 
at  this  congress — the  "service"  which,  in  the  course  of  their  work, 
they  find  it  profitable  to  render  to  the  community,  and  these  ques- 
tions will  be  discussed  in  almost  equal  number,  and  by  the  under- 
writers and  the  underwriter.  The  programme  indicates  that  the 
sessions  will  be  full  of  popular  interest,  and  should  attract  large 
audiences  of  the  general  public. 


WORLD'S  INSURANCE  CONGRESS  451 


AN  OPEN  LETTER  FROM  THE  PRESIDENT  OF  THE  NEW 
YORK  LIFE  INSURANCE  CO.  TO  THE  COMMISSIONER 
OF  THE  WORLD'S  INSURANCE  CONGRESS,  PAN- 
AMA-PACIFIC INTERNATIONAL  EXPOSITION 


New  York  Life  Insurance  Company 
New  York,  N.  Y. 

Darwin  P.  Kingsley, 

President. 

May  15,  1914. 
Mr.  W.  L.  HxVthaway, 

Commissioner,  World's  Insurance  Congress, 
San  Francisco,  California. 

Dear  Sir: 

San  Francisco  is  one  of  the  necessary  cities  of  the  world,  but 
that  the  Panama-Pacific  Exposition  of  1915  is  to  be  held  within 
her  gates  is  attributable  in  very  large  measure  to  insurance  and  its 
singular  service. 

I  do  not  say  that  San  Francisco  would  not  have  been  rebuilt  in 
any  event,  but  the  difference  between  San  Francisco  as  it  is  and 
San  Francisco  as  it  would  have  been  if  insurance  had  not  almost 
immediately  provided  its  stricken  people  with  $190,000,000  after 
calamity  fell,  is  something  so  considerable  that,  while  we  may  not 
exactly  measure  it,  everybody  must  recognize  it.  Of  this  $190,- 
000,000  nearly  $60,000,000  came  from  across  the  Atlantic.  In 
other  words,  the  foundations  of  insurance  were  wider  than  the 
nation,  wider  than  the  continent,  and  the  means  thus  provided  for 
reconstructing  San  Francisco  were  adequate  because  of  a  substan- 
tially unrestricted  operation  of  the  insurance  idea. 

No  idea,  therefore,  of  the  many  which  will  be  discussed  and 
advanced  during  this  Exposition  will  so  well  harmonize  with  its 
environment  as  insurance. 

A  great  fact  with  which  the  coming  World 's  Insurance  Congress 
will  be  faced — indeed  the  greatest  fact — is  that  insurance  of  all 
types  in  the  United  States  is  seriously  menaced  at  the  present  time 
by  conflicting  and  hostile  governmental  regulations  which  threaten 
— indeed  have  already  begun — to  impair  its  usefulness. 

We  all  know  that  the  Constitution  of  the  United  States  was 
the  outgrowth  of  commercial  necessity.  The  original  colonies  did 
not  form  the  Union  because  tliey  wanted  to.  In  commercial  mat- 
ters they  hated  each  other  cordially.  After  they  had  won  inde- 
pendence, they  indulged  in  acts  of  commercial  reprisal  which  seem 
to  us  at  this  distance  almost  unbelievable.  In  order  to  vent  their 
spleen,  some  of  the  colonies  discriminated  in  favor  of  European 


452  WORLD'S  INSURANCE  CONGRESS 

nations  as  against  their  sister  colonies.  The  menace  of  outside 
interference  finally  became  so  real  and  the  danger  so  imminent 
that  the  colonies  were  compelled  to  put  aside  some  of  their  ani- 
mosities in  order  to  get  together  for  the  common  defence.  The 
Constitution  of  the  United  States  adopted  in  1788  was  the  result 
of  this  movement.  If  at  that  time  the  people  of  the  various  colonies 
had  understood  how  flexible  the  instrument  was,  how  nationality 
would  spring  up  under  it,  how  the  central  government  would 
gradually  develop  a  real  sovereignty  in  place  of  the  spurious  sov- 
ereignty with  which  they  deluded  themselves — they  would  not  have 
adopted  it. 

The  notion  that  the  colonies  were  severally  sovereign — which 
was  never  true — survived  the  birth  of  the  new  nation  and  has 
plagued  it  ever  since.  Nationality  has  slowly  but  surely  evolved 
in  the  intervening  years,  but  the  old  prejudices  and  the  old  ani 
mosities  have  steadily  fought  that  development. 

Chief  Justice  Marshall  had  a  clear  vision  of  nationality  and  in 
some  of  his  great  decisions  did  as  much  to  give  the  Constitution 
its  present  meaning  as  the  men  who  fashioned  it  in  that  immortal 
convention  in  Philadelphia.  Marshall's  definition  of  the  relation 
between  the  general  government  and  the  States  was  substantially 
this: 

"The  action  of  the  general  government  should  be  applied  to  all 
the  external  concerns  of  the  nation,  and  to  those  internal  concerns 
which  affect  the  States  generally ;  while  to  the  States  is  reserved 
the  control  of  those  matters  which  are  completely  within  a  par- 
ticular State,  which  do  not  affect  other  States,  and  with  which  it 
is  not  necessary  to  interfere  for  the  purpose  of  executing  some  of 
the  general  powers  of  government." 

If  the  Supreme  Court  had  adhered  to  that  doctrine,  the  con- 
ditions which  threaten  the  usefulness  and  efficiency  of  all  kinds 
of  insurance  would  not  to-day  exist,  but  unfortunately  in  1868 
the  Court  fell  into  a  great  economic  error  in  declaring  that  insur- 
ance was  not  commerce.  It  repeated  the  error,  as  Courts  are  all 
prone  to  do,  from  time  to  time;  but  as  the  question  in  its  modern 
relations  had  never  been  fully  presented  to  the  Court,  it  was 
hoped  when  a  fresh  case,  involving  no  other  issue,  was  presented, 
the  Court  might — as  it  has  done  many  times  in  other  matters — 
reverse  its  earlier  decisions  and  declare,  as  the  interests  of  the 
public  clearly  demand,  that  insurance  is  commerce.  Those  who 
hoped  for  that  result  perhaps  overlooked  the  force  of  inertia. 
They  did  not  properly  appreciate  the  restraining  power  of  estab- 
lished practices  and  accumulated  precedents.  If  insurance  were 
declared  to  be  commerce,  down  would  go  the  whole  fabric  of 
State  supervision,  and  away  would  go  something  like  $17,000,000 
or  $18,000,000  taken  annually  by  politics  from  the  prudent  people 
who  through  insurance  protect  their  business  and  their  families. 


WORLD'S  INSURANCE  CONGRESS  453 

Supervision  by  forty-eight  separate  States  involves  political  pat- 
ronage and  great  political  power.  To  annihilate  by  a  single  decree 
a  system  so  entrenched  required  courage  of  the  highest  order. 
Two  of  the  Court  faced  the  facts  and  stood  for  the  doctrine 
(N.  Y.  Life  Ins.  Co.  v.  Deer  Lodge  County,  Montana)  that  insur- 
ance is  commerce ;  but  the  majority  adhered  to  the  precedents  and 
by  so  doing  shut  the  door  to  any  relief  under  the  commerce  clause 
of  the  Constitution  as  it  now  stands. 

This  was  a  heavy  blow  to  insurance,  and  served  to  emphasize  an 
increasing  peril.  To  be  supei-vised  by  forty-eight  separate  masters, 
each  of  whom  claims  substantial  control  over  all  transactions  wher- 
ever had,  means,  for  that  business,  a  recurrence  of  the  hostilities, 
the  animosites  and  the  commercial  impotence  which  menaced  the 
colonies  prior  to  the  adoption  of  the  Constitution. 

Under  such  conditions  it  is  rather  remarkable  that  companies 
were  able,  up  to  within  a  few  years,  to  comply  with  the  conflict- 
ing requirements  of  all  these  masters  and  do  business  in  all  the 
States.  Some  seven  years  ago,  substantially  all  the  life  companies 
were  driven  out  of  Texas  because  of  drastic  local  legislation. 
Since  that  time  fire  companies  have  had  serious  troubles  in  Missouri 
and  are  now  having  great  difficulties  in  Kentucky. 

With  our  highest  Court  explicitly  denying  to  the  Federal  Gov- 
ernment any  jurisdiction  whatever  over  insurance,  the  notable 
thing  is  not  that  we  are  now  having  trouble  but  that  we  did  not 
have  it  earlier. 

Insurance  long  ago  began  an  agitation  looking  toward  an 
amendment  to  the  Constitution — an  amendment  which  would 
clearly  place  amongst  the  enumerated  powers  of  Congress  the  au- 
thority to  control  insurance  within  the  States,  Territories  and  pos- 
sessions of  the  United  States.  Since  the  Supreme  Court  has  again 
and  finally  declared  that  insurance  is  not  commerce,  the  agitation 
has  been  renewed. 

The  agitation  has  taken  on  new  life  because  of  a  decision  by 
the  Supreme  Court,  handed  down  recently,  in  which  a  statute  of 
Kansas  is  upheld  which  gives  the  Superintendent  of  Insurance  of 
that  State  authority  to  fix  fire  insurance  rates.  Of  course  the 
Legislature  of  Kansas  can  fix  fire  insurance  rates,  it  can  fix  life 
insurance  rates,  and  the  rates  for  every  type  of  insurance.  In- 
deed, one  of  the  Justices,  in  dissenting,  said  of  the  opinion,  that  it 

".  .  .  is  not  a  mere  entering  wedge,  but  reaches  the  end  from 
the  beginning  and  announces  a  principle  Avhich  points  inevitably 
to  the  conclusion  that  the  price  of  every  article  sold  and  the  price 
of  every  service  offered  can  be  regulated  by  statute." 

Insurance,  therefore,  finds  itself  in  this  position : 
It  seeks  to  do  business  in  all  the  States;  indeed  it  must  if  it 
works  efficiently  and  successfully. 

The    basis    of   the    structure   must    be    broad, — broader,    much 


454  AVORLD'S  INSURANCE  CONGRESS 

broader  than  any  State,  broader  than  any  half  dozen  States;  in- 
deed added  strength  comes  if  the  basis  is  broader  than  any  nation. 

But  it  is  told  by  the  Supreme  Court,  first,  that  it  can  operate 
in  the  various  States  only  by  their  permission,  and  on  such  terms 
as  they  severally  establish;  and,  second,  that,  operating  in  that 
fashion,  it  is  subject  not  merely  to  regulation  in  the  ordinary 
meaning  of  that  word,  but  to  the  exercise  of  an  authority  which 
may  fix  the  price  at  which  it  shall  sell  its  wares — in  other  words, 
to  the  same  authority  under  which  a  person's  property  may  be 
taken  for  the  public  good. 

To  the  doctrine  that  States  may  fix  insurance  rates  two  Justices 
dissented  strongly,  and  as  evidence  that  the  insurance  contract  had 
always  been  considered  a  private  contract  and  not  impressed  with 
any  public  necessity,  they  cited  that  fact  that  no  State  had  earlier 
attempted  to  exercise  such  authority.  The  distinguished  dissent- 
ers overlooked  the  fact  that  the  State  of  Wisconsin  some  years 
ago  fixed  a  maximum  basis  for  the  premiums  of  life  insurance, 
not  only  for  that  State  but  incidentally  and  necessarily  for  all 
the  States.  For  a  life  insurance  company  to  charge  a  different 
rate  in  different  States  would  be  so  impracticable  that  business 
would  be  impossible.  The  dissenting  Justices  overlooked  this  pre- 
cedent because  it  has  not  since  happened  that  any  other  State  has 
been  moved  to  do  a  similar  thing,  and  no  test  of  the  validity  of 
the  statute  has  been  made.  But  since  the  Wisconsin  statute  was 
passed,  life  insurance  has  been  keenly  alive  to  what  would  happen 
if  other  States  should  take  like  action.  Our  highest  Court  now 
says  that  all  the  States  have  authority  so  to  act. 

In  these  circumstances  insurance  is  as  certainly  menaced  by 
the  animosities  inevitably  and  always  provoked  by  the  doctrine 
of  States'  Rights  as  the  commerce  of  the  colonies  was  before  the 
birth  of  the  nation.  Relief  must  be  had.  The  great  problem  be- 
fore all  insurance  is: 

Along  what  lines  shall  relief  be  sought? 

Encouraged  by  the  dissent  in  the  Deer  Lodge  ease,  many  strong 
men  believe  that  if  Congress  could  be  induced  to  pass  a  statute 
taking  charge  of  insurance  when  it  involves  the  citizens  of  more 
than  one  State,  the  Supreme  Court — notwithstanding  its  earlier 
decisions — would  sustain  such  a  statute.  In  other  words,  it  is  one 
thing  for  the  Court  to  pass  on  an  abstraction  and  another  to  pass 
upon  a  Federal  statute.  Two  of  the  Court  in  passing  on  an  ab- 
straction said  that  insurance  is  commerce.  It  is  altogether  prob- 
able that  others  hesitated,  and  that  hesitation  would  have  been 
resolved  in  favor  of  the  coordinate  branch  of  government  if  that  co- 
ordinate branch,  in  the  exercise  of  its  discretions  had  declared 
for  Federal  control  of  insurance. 

But  upon  the  whole  and  in  order  to  reach  a  conclusion  that 
will  be  unequivocal,  insurance  opinion  rather  leans  toward  an 
effort  to  secure  an  amendment  to  the  Federal  Constitution  which 


AVORLD'S  INSURANCE  CONGRESS  455 

will  specifically  put  all  insurance  done  in  an  interstate  way  under 
the  control  of  Congress. 

In  justifying  the  Court's  action  in  upholding  the  validity  of 
the  Kansas  statute,  Justice  McKenna  draws  a  striking  picture  of 
the  character  and  usefulness  of  fire  insurance,  seeking  to  drive 
home  its  great  importance  and  enforce  its  public  relations.  His 
word  painting  may  or  may  not  justify  the  doctrine  that  a  State 
may  fix  rates,  but  it  clearly  proves  that  if  any  power  is  to  fix 
rates  in  this  country,  it  must  be  the  Federal  power  and  not  the 
power  of  the  separate  States.     He  says: 

''The  effect  of  insurance — indeed,  it  has  been  said  its  fundamen- 
tal object — is  to  distribute  the  loss  over  as  wide  an  area  as  pos- 
sible. In  other  words,  the  loss  is  spread  over  the  country,  the  dis- 
aster to  an  individual  is  shared  by  many,  the  disaster  to  a  com- 
munity is  shared  by  other  communities;  great  catastrophes  are 
thereby  lessened,  and  it  may  be,  repaired.  In  assimilation  of  in- 
surance to  a  tax,  the  companies  have  been  said  to  be  the  mere 
machinery  by  which  the  inevitable  losses  by  fire  are  distributed 
so  as  to  fall  as  lightly  as  possible  on  the  public  at  large,  the  body 
of  the  insured,  not  the  companies,  paying  the  tax.  Their  efficiency, 
therefore,  and  solvency  are  of  great  concern.  The  other  objects, 
direct  and  indirect,  of  insurance  we  need  not  mention.  Indeed,  it 
may  be  enough  to  say,  without  stating  other  effects  of  insurance, 
that  a  large  part  of  the  country's  wealth,  subject  to  uncertainty  of 
loss  through  fire,  is  protected  by  insurance.  This  demonstrates  the 
interest  of  the  public  in  it  and  we  need  not  dispute  with  the 
economists  that  this  is  the  result  of  the  'substitution  of  certain 
for  uncertain  loss'  or  the  diffusion  of  positive  loss  oyer  a  large 
group  of  persons,  as  we  have  already  said  to  be  certainly  one  of 
its  effects.  We  can  see,  therefore,  how  it  has  come  to  be  consid- 
ered a  matter  of  public  concern  to  regulate  it,  and  governmental 
insurance  has  its  advocates  and  even  examples.  Contracts  of  in- 
surance, therefore,  have  greater  public  consequence  than  contracts 
between  individuals  to  do  or  not  to  do  a  particular  thing  whose 
effect  stops  with  the  individuals." 

The  distinguished  Justice,  in  this  impressive  description  of  the 
service  to  business  and  society  rendered  by  fire  insurance,  de- 
scribed at  the  same  time  the  service  and  the  nature  of  every  con- 
siderable kind  of  insurance;  but  he  apparently  did  not  perceive 
that  what  he  described  existed  and  was  being  justiced  only  be- 
cause the  State  powers,  which  the  Court  then  confirmed,  had  not 
hitherto  been  exercised.  The  Justice,  in  other  words,  based  his 
decree  on  the  existence  of  a  service  and  a  relation  which  will  here- 
after be  gravely  limited  and  embarrassed,  if  not  largely  destroyed, 
by  that  self -same  decree.  If  the  States  had  from  the  beginning  ex- 
ercised the  rate-making  power,  in  addition  to  current  regulations, 
we  should  now  have  in  this  country  no  great  fire  insurance  com- 
panies, no  great  life  insurance  companies,  no  great  fidelity  or 
surety  companies, — just  as  we  should  now  not  be  a  nation  if  the 
Confederation  had  not  been  abandoned  and  the  Union  created. 


456       WORLD'S  INSURANCE  CONGRESS 

Where  the  exercise  of  a  named  authority  will  certainly  diminish, 
if  not  substantially  destroy,  the  matter  on  which  it  operates,  either 
the  thing  to  be  so  governed  is  not  entirely  useful  or  the  authority 
to  be  so  exercised  is  not  entirely  wholesome.  For  our  highest 
Court  to  find  in  the  wide  usefulness  of  an  idea  warrant  for  the 
confirmation  of  an  authority  which  will  destroy  that  usefulness 
is  a  curious  judicial  development.  The  majority  opinion  leaves 
no  doubt  as  to  the  entire  usefulness  of  insurance,  while  the  strong 
minority  opinion  leaves  no  doubt  as  to  the  unwholesome  character 
of  an  authority  which  will  establish  forty-eight  separate  rate-mak- 
ing powers. 

What  other  thing,  therefore,  so  distinctive,  what  other  topic  so 
vital,  what  other  matter  so  certainly  related  to  the  future  of 
business  can  your  coming  Congress  so  well  deal  with? 

Merely  to  meet  and  discuss  old  topics — such  as  management  and 
taxation— will  have  a  limited  interest.  To  seize  boldly  on  this  sit- 
uation, to  speak  in  no  uncertain  tones  with  regard  to  it,  to  pledge, 
so  far  as  you  properly  can.  all  the  powers  of  insurance  in  its 
various  forms  and  through  all  its  vast  organization  to  a  campaign 
in  favor  of  a  Constitutional  amendment  of  the  character  indi- 
cated, would  be  at  once  an  act  of  leadership  and  of  statesmanship. 

I  commend  such  action  to  your  careful  consideration. 

Yours  truly, 

Darwin  P.  Kingsley, 

President. 


AN  OPEN  LETTER  REPLYING  TO  THE  PRESIDENT  OP 
THE  NEW  YORK  LIFE  INSURANCE  CO. 

By  the  Commissioner  of  the  World's  Insurance  Congress 
Events  op  the  Panama-Pacific  International  Exposition 

Panama-Pacific  International  Exposition 

1915 

Exposition  Building 

Office  of  the  Commissioner  for  the 

World's  Insurance  Congress  Events 

Of  1915 

San  Francisco,  Cal.,  June  16th,  1914. 

Darwin  P.  Kingsley,  Esq.,  President, 
New  York  Life  Insurance  Company, 
New  York  City. 

Dear  Sir: 

I  have  rea<l   with  absorbing  interest  your  masterful   presenta- 
tion of  the  subject  covered  in  your  open  letter  of  ^lay  15th:  and 


WORLD'S  INSURANCE  CONGRESS  457 

have  caused  to  be  sent  to  each  member  of  the  National  Council 
of  this  organization,  as  well  as  to  other  interested  parties,  a  copy, 
that  they  all  may  have  this  early  opportunity  of  learning  your 
viewpoints  and  objects,  and  the  reasons  actuating  them. 

In  this  way  I  hope  to  give  all  those  influences  interested  in 
the  coming  Congress  the  advance  opportunity  for  a  broad  discus- 
sion of  this  and  other  great  subjects  that  can  reasonably  be  ex- 
pected to  claim  its  attention,  for  it  is  easily  apparent  that  the  big 
matters  which  will  come  before  this  Congress  for  consideration  are 
those  in  which  the  big  insurance  influences  of  the  Nation  are  sufifi- 
eiently  interested  to  bring  to  the  front  with  the  initiative  force 
that  has  been  displayed  by  you  on  the  subject  of  Federal  super- 
vision. 

AVhile  the  closing  paragraphs  of  your  letter  are  frankly  gratify- 
ing, nevertheless  I  feel  that  you  will  agree  with  me,  after  a  care- 
ful study  of  the  growth  and  formation  of  this  Congress  movement 
to  date,  that  it  is  scarcely  the  province  of  this  Commission  to  adopt 
and  advocate  any  particular  object  other  than  the  broader  one  of 
the  task  to  which  we  have  set  ourselves;  namely — of  effecting  for 
the  first  time  in  the  world's  history  a  harmonious  cooperation  be- 
tween the  tremendous  segregated  influences  of  insurance  of  the 
accomplishment  of  such  purposes  as  they  may  decide  to  be  mu- 
tually advantageous; — and  the  abandonment  of  this  broad  prin- 
ciple to  which  we  are  committed,  for  the  advocacy  of  any  one 
particular  object  (no  matter  what  our  personal  views  regarding 
it  might  be)  would  in  all  probability,  I  am  sure  you  will  readily 
realize,  result  in  making  the  work  of  bringing  these  many  segre- 
gated influences  together  at  least  more  diflficult,  if  not  in  some 
cases  impossible. 

Consequently,  it  became  evident  in  the  early  history  of  this 
work  that  a  body  truly  national  in  its  scope  of  influence  must  be 
created  whose  voice  would  be  dominant  in  all  matters  regarding, 
the  personnel  of  the  Congress  and  the  program  covering  its  sub- 
jects ;  and  for  this  purpose  I  asked  each  national  or  semi-national 
association  representing  any  branch  of  insurance  or  its  allied  pro- 
fessions to  pass  a  resolution  favoring  this  Congress,  and  to  name 
some  prominent  member  to  represent  it  upon  this  National 
Council ;  and  up  to  date  the  following  associations  have,  in  their 
regular  conventions,  ofRcially  passed  such  resolutions  of  endorse- 
ment, and  selected  the  gentlemen  whose  names  follow  to  represent 
them  in  this  National  Council ;  and  upon  them,  and  such  additional 
appointments  as  a  complete  representation  may  require,  will  rest 
the  responsibility  of  speaking  for  their  various  associations  and 
interests  as  to  the  subjects  which  this  Congress  can  deal  with  to 
the  advantage  of  American  insurance  as  a  whole : 

Association  op  Life  Insurance  Ppesidents: 

Robert  Lynn  Cox,  General  Counsel  and  Manager,  Association 
of  Life  Insurance  Presidents,  New  York. 


458       WORLD'S  INSURANCE  CONGRESS 

National  Board  of  Fire  Underwriters: 

Whitney   Palace,    Vice   President,   Hartford   Fire   Insurance 
Company,  Hartford,  Conn. 

American  Association  of  Accident  Underwriters: 

Charles  C.  Boyer,  President,  American  Association  of  Acci- 
dent Underwriters,  Chicago,  111. 

Actuarial  Society  of  America: 

W.  C.  Macdonald,  Secretary  and  Actuary,  Confederation  Life 
Association,  Toronto. 

Insurance  Institute  of  America: 

Herbert    Folger,    Assistant    General    Agent,    G.    A.    Tyson 
Agency,  San  Francisco. 

American  Life  Convention: 

Thomas  L.  Miller,  President,  West  Coast  Life  Insurance  Com- 
pany, San  Francisco. 

The  Western  Union: 

A.  W.  Damon,  President,  Springfield  Fire  and  Marine  Insur- 
ance Company,  Springfield,  Mass. 

International   Association   of    Casualty   and   Surety   Under- 
writers : 
Charles    H.    Holland,    General    Manager,    Royal    Indemnity 
Company,  New  York. 

National  Association  of  Life  Underwriters: 

George  A.  Rathbun,  Manager,  Equitable  Life  Assurance  So- 
ciety, Los  Angeles,  Cal. 

National  Association  of  Insurance  Agents  : 

C.  H.  Woodworth,  7  West  Seneca  Street,  Buffalo,  N.  Y. 

Surety  Association  op  America: 

R.  R.  Gilkey,  Secretary,  Surety  Association  of  America,  New 
York  City. 

National  Fire  Protection  Association: 

Franklin  H.  Wentworth,  Secretary,  National  Fire  Protection 
Association,   Boston,  Mass. 

National  Fraternal  Congress  of  America: 

A.  R.  Talbot,  Head  Consul,  Modern  Woodmen  of  America, 
Lincoln,  Neb. 

Detroit  Conference: 

Louis  H.  Fibel,  President,  Great  Eastern  Casualty  Company, 
New  York  City. 

Western  Insurance  Bureau: 

E.   G.  Halle,  Manager,  Germania  Fire  Insurance  Company, 
Chicago,  111. 

Association  of  Life  Insurance  Medical  Directors  : 

W.  W.  Beckett,  M.  D.,  IMedical  Director,  Pacific  :Mutual  Life 
Insurance  Company,  Los  Angeles,  Cal. 
National  Council  for  Industrial  Safety: 

David  Van  Sfhaaok,  Director,  Bureau  of  Inspection  and  Acci- 
dent Prevention,  ^.tna  Life  Insurance  Co.,  Hartford,  Conn. 
Canadian  Life  Insurance  Officers'  Association: 


WORLD'S  INSURANCE  CONGRESS  459 

T.  B.  Macaulay,  Managing  Director,  Sun  Life  Assurance  Com- 
pany of  Canada,  Montreal,  Que. 

National  Association  of  Credit  Men: 

C.  T.  Hughes,  Secretary,  San  Francisco  Credit  Men's  Asso- 
ciation, San  Francisco. 

American  Society  for  Fire  Prevention  : 

Abram  W.  Herbst,  Director  of  Safety,  American  Society  for 
Fire  Prevention,  New  York  City. 

American  Institute  of  Actuaries: 

Oswald  J.  Arnold,  Secretary  and  Actuary,  Illinois  Life  In- 
surance Company,  Chicago,  111. 

National  Association  of  Casualty  and  Surety  Agents: 

C.  L.  Jones,  Resident  Manager,  Ocean  Accident  and  Guarantee 
Corporation,  San  Francisco. 

Life  Underv^^riters '  Association  of  Canada: 

John  A.  Tory,  Honorary  President,  Life  Underwriters'  Asso- 
ciation of  Canada,  Toronto,  Can. 

Fire  Underwriters'  Association  of  the  Pacific: 

T.   H.  Williams,   Ex-President,   Fire  Underwriters'  Associa- 
tion of  the  Pacific,  San  Francisco. 

Southern  Casualty  and  Surety  Conference: 

Charles  E.  Clarke,  Secretary,  Peninsular  Casualty  Company, 
Jacksonville,  Fla. 

California  State  Association  of  Local  Fire  Insurance  Agents  : 
W.  G.  Thompson,  President,  California  State  Association  of 
Local  Fire  Insurance  Agents,  Napa,  Cal. 

Association  of  Life  Insurance  Counsel: 

Wm.  J.  Tully,  General  Solicitor,  Metropolitan  Life  Insurance 
Company,  New  York  City. 

Pacific  Coast  Automobile  Underwriters: 

J.   B.   Levison,   Vice   President,   Fireman's   Fund   Insurance 
Company,  San  Francisco. 

Underwriters'  Laboratories,  Inc.: 

John  Marshall,  Jr.,  Associate  Manager,  Fireman's  Fund  In- 
surance Company,  Chicago,  111. 

Insurance  Brokers'  Exchange  op  San  Francisco: 
R.  C.  Ward,  San  Francisco. 

Plate  Glass  Service  and  Information  Bureau: 

H.    C.   Hedden,    Secretary,   New   Jersey   Fidelity   and   Plate 
Glass  Insurance,  Newark,  N.  J. 

National  Association  op  Mutual  Insurance  Companies: 

W.  E.  Straub,  President,  Farmers'  Mutual  Insurance  Com- 
pany, Lincoln,  Neb. 

Board  op  Fire  Underwriters  op  the  Pacific: 

Rolla  V.  Watt,  President,  Board  of  Fire  Underwriters  of  the 
Pacific,  San  Francisco. 

Fire  Underwriters'  Association  op  the  Northwest: 

John  Marshall,  Jr.,  Associate  Manager,  Fireman's  Fund  In- 
surance Company,  Chicago,  111. 


460  WORLD'S  INSURANCE  CONGRESS 

Federated  Fraternities  : 

W.  A.  Roane,  President,  Federated  Fraternities,  Atlanta,  Ga. 
The  Casualty  Underwriters'  Association  of  C.vlifornia: 

E.  C.  Landis,  ]\lanager,  London  Guarantee  and  Accident  Com- 
pany, San  Francisco. 

Underwriters'  Bureau  of  New  England: 

Gorham  Dana,  ^Manager,  Underwriters'  Bureau  of  New  Eng- 
land, Boston,  ]Mass. 

Southeastern  Underwriters'  Association: 

S.  Y.  Tupper,  Manager,  Queen  Insurance  Company,  Atlanta, 
Ga. 

Ancient  and  Honorable  Order  of  the  Blue  Goose: 

T.  H.  Williams,  Past  Most  Loyal  Grand  Gander,  Ancient  and 
Honorable  Order  of  the  Blue  Goose,  San  Francisco. 

Fire  Underwriters'  Inspection  Bureau: 

F.  H.   Porter,  Manager,  Fire  Underwriters'  Inspection  Bu- 
reau, San  Francisco. 

Workmen's  Compensation  Service  Bureau: 

Charles  H.  Holland,  General  Manager,  Royal  Indemnity  Com- 
pany, New  York  City. 

The  above  associations  have  been  conservatively  estimated  by 
well  informed  insurance  men  to  represent  the  principal  insurance 
influences  of  the  Nation.  We  have  assurances  that  the  few  who 
have  not  already  officially  acted  in  this  matter  will  do  so  at  their 
coming  annual  conventions,  and  with  such  additional  appoint- 
ments as  may  become  necessary  to  ensure  full  representation,  we 
feel  justified  in  stating  that  the  organization  is  well  nigh  com- 
pleted for  the  beginning  of  the  actual  work  of  the  formation  of 
the  Congress  and  deciding  upon  what  subjects  shall  enter  into 
its  program. 

The  influences  thus  brought  together  in  this  Congress  will  be 
the  direct  representatives  of  all  who  derive  their  livelihood  from 
the  commerce  of  in.surance  or  its  allied  professions,  who  number 
approximately  fifteen  out  of  every  one  thousand  of  the  American 
population,  and  these  fifteen  people  out  of  every  thousand  are 
of  the  most  active  and  intelligent  class,  and  are  located  in  every 
important  city  block  and  practically  every  crossroads  of  America, 
it  will  not  be  a  large  undertaking  for  them  to  thoroughly  educate 
the  other  nine  hundred  and  eighty-five,  or  that  part  of  the  nine 
hundred  and  eighty-five  who  are  insurers,  as  to  what  is  their  best 
interest  in  all  matters  of  public  policy  connected  with  the  insur- 
ance which  their  thrift  pays  for;  and  if  this  Congress  results  in 
one  or  more  concrete  decisions  regarding  what  the  insurers  of 
America  should  know,  and  such  decisions  flow  back  through  these 
various  influences  to  these  fifteen  out  of  every  one  thousand,  it 
would  appear  that  any  big  issues  that  depend  upon  the  education 
of  the  intelligent  ma.sses  of  American  population  could  most  uni- 
formly, effectively  and  economically  be  reached  in  this  way. 


WORLD'S  INSURANCE  CONGRESS  461 

However,  as  to  what  the  big  subject  or  subjects  may  be  that 
this  Congress  will  consider,  the  conclusions  of  which  will  flow 
back  through  these  various  channels  for  the  education  of  the  pub- 
lic mind,  must,  to  have  weighty  consideration,  first  be  decided  by 
this  National  Council,  and  afterwards  ratified  by  the  Congress  in 
session. 

Now,  as  the  laws  and  rules  governing  almost  every  undertaking 
of  natural  growth  are  gradually  created  with  its  history,  it  seems 
best  to  reproduce  here,  following  this  letter,  a  copy  of  the  paper 
which  I  delivered  before  The  National  Association  of  Life  Under- 
writers at  Atlantic  City  last  September,  for  the  reason  that  the 
history  of  the  movement  is  carefully  outlined  in  that  paper  and 
many  of  the  objects  to  which  we  are  committed  show  throughout 
its  history.* 

However,  I  feel  that  the  full  force  and  possibilities  of  this 
movement  can  best  be  understood  by  a  thorough  reading  of  its 
history,  which  the  following  paper  will  give. 

Yours  truly, 

W.  L,  HathxVway, 

Commissioner. 


FEDERAL  SUPERVISION  OF  LIFE  INSURANCE : 
POSSIBILITY— FEASIBILITY  f 

By  Dan  W.  Simms 

General  Counsel,  Lafayette  Life  Insurance  Company, 
Lafayette,  Ind. 

If  every  insurance  company,  every  policyholder  and  every  in- 
surance organization  in  the  United  States  were  agreed  in  a  de- 
mand for  exclusive  Federal  supervision ;  if  every  Senator  and  Rep- 
resentative of  the  Federal  Congress  had  voted  as  a  unit  upon  the 
passage  of  such  a  law,  committing  the  whole  subject  of  life  insur- 
ance to  Federal  supervision,  to  the  exclusion  of  State  supervision, 
and  the  President  of  the  United  States  had  affixed  his  signature  to 
the  bill,  we  should  yet  be  no  nearer  exclusive  Federal  supervision 
than  we  are  to-day. 

It  is  obvious  that  Federal  supervision,  under  the  existing  Fed- 
eral Constitution,  could  be  exercised  only  on  the  theory  that  life 
insurance  is  interstate  commerce,  or  an  instrumentality  thereof, 
within  the  meaning  of  that  instrument.  That  life  insurance  is 
not  interstate  commerce  would  seem,  on  principle,  too  clear  for 

*  This  address  is  given  on  page  437. 

fAn  address  delivered  at  Dallas,  Texas,  before  the  Legal  Section  of  the 
American  Life  Convention,  October  9,  1914.  (Issued  by  the  Commission  of 
the  World's  Insurance  Congress  Events  at  the  request  of  the  American  Life 
Convention  as  indicating  its  position  on  Federal  Supervision.) 


462       WORLD'S  INSURANCE  CONGRESS 

debate.  But  strain  and  stretch  the  meaning  of  the  phrase,  ' '  inter- 
state commerce,"  however  much  we  may,  the  Supreme  Court  of 
the  United  States  has  defined  it  in  terms  which  neither  lawyer  nor 
layman  may  misunderstand  and  by  its  oft-repeated  ipse  dixit  has 
declared  that  life  insurance  is  neither  interstate  commerce  nor  an 
instrumentality  thereof. 

Nearly  a  half  century  since,  INIr.  Justice  Field,  speaking  for  the 
Supreme  Court  of  the  United  States,  in  Paul  v.  Virginia,  8  Wal- 
lace 168,  said : 

"Issuing  a  policy  of  insurance  is  not  a  transaction  of  commerce. 
The  policies  are  simple  contracts  of  indemnity  against  loss  by  fire, 
entered  into  between  the  corporations  and  the  assured,  for  a  con- 
sideration paid  by  the  latter.  These  contracts  are  not  articles  of 
commerce,  in  any  proper  meaning  of  the  word.  They  are  not  sub- 
jects of  trade  and  barter,  offered  in  the  market  as  something  hav- 
ing an  existence  and  value  independent  of  the  parties  to  them. 
They  are  not  commodities  to  be  shipped  or  forwarded  from  one 
State  to  another  and  then  put  up  for  sale.  They  are  like  other 
personal  contracts  between  parties,  which  are  completed  by  their 
signatures  and  the  transfer  of  consideration.  Such  contracts  are 
not  interstate  transactions,  though  the  parties  may  be  domiciled 
in  different  States.  The  policies  do  not  take  effect — are  not  ex- 
ecuted contracts — until  delivered  by  the  agent  in  Virginia.  They 
are  then  local  transactions  and  are  governed  by  the  local  law. 
They  do  not  constitute  a  part  of  the  commerce  between  the  States 
any  more  than  the  contract  for  the  purchase  and  sale  of  goods  in 
Virginia,  by  a  citizen  of  New  York  whilst  in  Virginia,  would  con- 
stitute a  portion  of  such  commerce." 

In  Fire  Association  of  Philadelphia  v.  New  York,  119  U.  S.  110, 
Mr.  Justice  Blatchford,  in  1886,  speaking  for  the  same  tribunal, 
quoted  from  Paul  v.  Virginia,  supra,  as  follows: 

''As  to  the  power  of  Congress  to  regulate  commerce  among  the 
several  States,  the  court  said  that  while  the  powers  conferred  in- 
cluded commerce  carried  on  by  corporations,  as  well  as  that  car- 
ried on  by  individuals,  'Issuing  a  policy  of  insurance  is  not  a 
transaction  of  commerce.'  This  decision  only  followed  the  prin- 
ciple laid  down  in  the  earlier  cases  of  Bank  of  Augusta  v.  Earl, 
13  Peters,  519,  and  Lafayette  Insurance  Company  v.  French,  18 
Howard,  404." 

In  Hooper  v.  State  of  California,  155  U.  S.  647,  ]\Ir.  Justice 
Wliite,  speaking  for  that  court,  said: 

"The  contention  here  is,  that  inasmuch  as  the  contract  was  one 
for  marine  insurance,  it  was  a  matter  of  interstate  commerce,  and 
as  such  beyond  the  reach  of  State  authority  and  included  among 
the  exceptions  to  the  general  rule.  This  proposition  i7ivolves  an 
erroneous  conception  of  what  constitutes  interstate  commerce. 
That  the  business  of  insurance  does  not  generally  appertain  to 


WORLD'S  INSURANCE  CONGRESS  463 

such  commerce  has  been  settled  since  the  case  of  Paul  v.  Virginia, 
supra.  Whilst  it  is  true  that  in  Paul  v.  Virginia,  and  in  most  of 
the  cases  in  which  it  has  been  followed,  the  particular  contract 
under  consideration  was  for  insurance  against  fire,  the  principle 
upon  which  these  cases  were  decided  involved  the  question  of 
whether  insurance  of  any  kind  constituted  interstate  commerce. 
The  court,  in  reaching  a  conclusion  upon  this  question,  was  not  con- 
cerned with  any  matter  of  distinction  between  marine  and  fire 
insurance,  but  proceeded  upon  a  broad  analysis  of  the  nature  of 
interstate  commerce  and  of  the  relation  which  insurance  contracts 
generally  bear  thereto." 

Following  this,  Mr.  Justice  White  quotes  with  approval  the  lan- 
guage of  Mr.  Justice  Field  in  Paul  v.  Virginia  above  set  out. 

In  New  York  Life  Insurance  Company  v.  Cravens,  178  U.S.  389, 
Mr.  Justice  McKenna,  delivering  the  opinion  of  the  court,  in  1899, 
said: 

"An  interstate  character  is  claimed  for  the  policy,  as  we  under- 
stand the  argument,  because  plaintiff  in  error  is  a  New  York  cor- 
poration and  the  insured  was  a  citizen  of  Missouri,  and  because, 
further,  the  plaintiff  in  error  did  business  in  other  States  and 
countries.  Does  not  the  argument  prove  too  much?  Does  it  de- 
pend upon  the  residence  of  plaintiff  in  error  in  New  York  ?  If  so, 
it  would  seem  that  every  contract  between  citizens  of  different 
States  becomes  at  once  an  interstate  contract  and  may  be  re- 
moved from  the  control  of  the  laws  of  the  State  at  the  choice  of 
parties.  If  the  argument  does  not  depend  here  on  the  residence 
of  the  plaintiff  in  error,  but  on  the  other  elements,  a  Missouri  in- 
surance corporation  can  have  the  same  relation  to  them  as  plain- 
tiff in  error  and  can  be,  as  much  as  plaintiff  in  error  claims  to  be, 
'the  administrator  of  a  fund  collected  from  the  policyholders  in 
different  States  and  counties,  for  their  benefit'— the  condition 
which  plaintiff  in  error  claims  demonstrates  the  necessity  of  a  uni- 
form law,  to  be  stipulated  by  the  parties,  exempt  from  the  inter- 
ference or  the  prohibition  of  the  State  where  the  insurance  com- 
pany is  doing  business.  And  yet  plaintiff  in  error  seems  to  con- 
cede that  such  power  of  stipulation  Missouri  corporations  do  not 
have,  while  it,  a  foreign  corporation,  and  because  it  is  a  foreign 
corporation,  does  have." 

After  stating  the  necessity  of  a  uniform  law  and  an  equal  neces- 
sity that  parties  may  stipulate  for  it,  counsel  for  plaintiff  in  error 
say: 

"It  necessarily  follows,  therefore,  that  the  insurance  policy  con- 
tracts of  foreign  insurance  companies,  as  contracts  of  other  foreign 
corporations,  made  by  them  with  the  citizens  of  a  State,  when  do- 
ing business  in  that  State,  through  the  comity  of  the  State,  are 
like  the  contracts  of  natural  persons,  subject  t"o  the  limitations  of 
their  OM^n  charters,  and  the  suits  of  such  contracts  is  to  be  deter- 
mined by  the  fundamental  rules  of  'universal  law.'  " 


4G4       WORLD'S  INSURANCE  CONGRESS 

Discussing  this  contention  of  counsel  for  plaintiff  in  error,  the 
court  proceeds  to  say: 

"A  foreign  corporation  undoubtedly  is  not  a  domestic  corpo- 
ration, and  the  distinction  must  often  be  observed,  but  the  deduc- 
tion from  it  by  plaintiff  in  error  cannot  be  maintained. 

' '  The  power  of  a  State  over  foreign  corporations  is  not  less  than 
the  power  of  a  State  over  domestic  corporations.  No  case  declares 
otherwise.  We  said  in  Orient  Ins.  Co.  v.  Daggs,  172  U.  S.  557; 
43  L.  Ed.  552,  19  Sup.  Ct.  Rep.,  281: 

"  'That  which  a  State  may  do  with  corporations  of  its  own  cre- 
ation it  may  do  with  foreign  corporations  admitted  into  the  State. 
This  seems  to  be  denied ;  if  not  generally,  at  least  as  to  plaintiff  in 
error.  The  denial  is  extreme  and  cannot  be  maintained.  The 
power  of  a  State  to  impose  conditions  upon  foreign  corporations 
is  certainly  as  extensive  as  the  power  over  domestic  corporations, 
and  is  fully  explained  in  Hooper  v.  California,  155  U.  S.  648;  39 
L.  Ed.,  297,  5  Inters.  Com.  Rep.,  610,  15  Sup.  Ct.  Rep.,  207,  and 
need  not  be  repeated.' 

"Is  the  statute  an  attempted  regulation  of  commerce  between 
the  States?  In  other  words,  is  mutual  life  insurance  commerce 
between  the  States  ? 

"That  the  business  of  fire  insurance  is  not  interstate  commerce 
is  decided  in  Paul  v.  Virginia.  8  Wall.  168,  19  L.  Ed.  357 ;  Liver- 
pool &  L.  L.  &  F.  Ins.  Co.  v.  Massachusetts,  10  Wall.  556,  19  L. 
Ed.  1029;  Philadelphia  Fire  Asso.  v.  New  York,  119  U.  S.  110, 
30  L.  Ed.  342,  7  Sup.  Ct.  Rep.  108.  That  the  business  of  marine 
insurance  is  not  is  decided  in  Hooper  v.  California,  155  U.  S.  648, 
39  L.  Ed.  297,  5  Inters.  Com.  Rep.  610,  15  Sup.  Ct.  Rep.  207.  In 
the  latter  ease  it  is  said  that  the  contention  that  it  is  'involves  an 
erroneous  conception  of  what  constitutes  interstate  commerce.' 

"We  omit  the  reasoning  by  which  that  is  demonstrated,  and  will 
only  repeat :  '  The  business  of  insurance  is  not  commerce.  The 
contract  of  insurance  is  not  an  instrumentality  of  commerce.  The 
making  of  such  a  contract  is  a  mere  incident  of  commercial  inter- 
course, and  in  this  respect  there  is  no  difference  whatever  between 
insurance  against  fire  and  insurance  against  "the  perils  of  the 
sea!"  '  And  we  add,  or  'against  the  uncertainty  of  man's  mor- 
tality.' " 

A  number  of  other  cases  were  decided  within  the  period  covered 
bj^  these  decisions,  all  in  accord  with  the  doctrine  here  announced. 

To  the  average  lawyer,  engaged  in  the  active  practice,  these 
decisions  of  the  court  of  last  resort  would  seem  to  have  been 
sufficient  to  foreclose  the  question  of  the  possibility  of  Federal 
supervision  of  life  insurance.  But  one  of  the  greatest  insurance 
companies  of  the  world  still  indulged  the  hope  that  a  fresh  case, 
tendering  the  modern  relations  of  life  insurance,  could  be  so  pre- 
sented as  that  the  court  might  be  led  to  see  the  error  of  its  ways 
and  overrule  these  decisions  covering  an  unbroken  period  of  al- 
most a  half  century. 

Out  of  this  hope  came  the  ease  of  New  York  Life  Insurance  Co. 


WORLD'S  INSURANCE  CONGRESS  465 

V.  Deer  Lodge  County,  an  action  commenced  in  the  District  Court 
of  Deer  Lodge  County,  Montana,  framed  in  such  manner  as  to 
compel  a  decision  of  the  sole  issue:  Is  Federal  supervision  of 
life  insuraJice  possible  under  existing  law? 

The  company  lost  in  the  local  court,  met  a  like  fate  in  the 
Supreme  Court  of  Montana,  and  promptly  carried  the  case  to  the 
Supreme  Court  of  the  United  States.  So  earnestly  and  ably  was 
the  issue  presented  to  that  tribunal  that  it  re-examined  with  great 
care  all  the  decisions  attacked.  From  the  opinion  handed  down 
December  15,  1913,  by  Mr.  Justice  McKenna,  I  quote  at  length, 
as  follows: 


* '  The  same  conention  is  made  here  as  in  the  State  courts ;  that  is, 
that  the  tax  is  a  burden  on  interstate  commerce ;  and  an  elaborate 
argument  is  presented  to  distinguish  this  case  from  those  in  which 
this  court  has  decided  that  insurance  is  not  commerce.  These 
cases  are:  Paul  v.  Virginia,  8  Wall.  168,  19  L.  Ed.  357;  Ducat  v. 
Chicago,  10  Wall.  410,  19  L.  Ed.  972;  Liverpool  &  L.  Life  &  F. 
Ins.  Co.  V.  Massachusetts  (Liverpool  &  L.  Life  &  F.  Ins.  Co.  v. 
Oliver),  10  Wall.  566,  19  L.  Ed.  1029;  Fire  Asso.  of  Philadelphia 
V.  New  York,  119  U.  S.  110,  30  L.  Ed.  342,  7  Sup.  Ct.  Rep.  108 ; 
Hooper  v.  California,  155  U.  S.  648,  39  L.  Ed.  297,  5  Inters.  Com. 
Rep.  610,  15  Sup.  Ct.  Rep.  207 ;  Noble  v:  Mitchell,  164  U.  S.  367, 
41  L.  Ed.  324,  22  Sup.  Ct.  Rep.  238. 

*'If  we  consider  these  cases  numerically,  the  deliberation  of 
their  reasoning,  and  the  time  they  cover,  they  constitute  a  formid- 
able body  of  authority  and  strongly  invoke  the  sanction  of  the  rule 
of  stare  decisis.  This  we  especially  emphasize,  for  all  of  the  cases 
concerned,  as  the  case  at  bar  does,  the  validity  of  State  legislation, 
and  under  varying  circumstances  the  same  principle  was  applied 
in  all  of  them.  For  over  forty-five  years  they  have  been  the  legal 
justification  for  such  legislation.  To  reverse  the  cases,  therefore, 
would  require  us  to  promulgate  a  new  rule  of  constitutional  in- 
hibition upon  the  States,  and  which  would  compel  a  change  of 
their  policy  and  a  readjustment  of  their  laws.  Such  result  neces- 
sarily urges  against  a  change  of  decision.  In  deference,  however, 
to  the  earnestness  of  counsel,  we  will  consider  more  particularly 
(1)  what  the  cases  decide,  and  (2)  whether  they  are  wrong  in  prin- 
ciple. 

"Paul  V.  Virginia  is  the  progenitor  case.  A  law  of  Virginia  pre- 
cluded any  insurance  company  not  incorporated  under  the  laws 
of  the  State  doing  business  in  the  State  without  previously  ob- 
taining a  license  for  that  purpose,  which  could  only  be  obtained 
by  a  deposit  with  the  State  treasury  of  bonds  of  a  specified  char- 
acter to  an  amount  varying  from  thirty  to  fifty  thousand  dollars. 
A  subsequent  law  required  the  agent  of  a  foreign  insurance  com- 
pany to  take  out  a  license. 

"Paul  was  appointed  the  agent  of  several  fire  insurance  com- 
panies incorporated  in  the  State  of  New  York.  He  applied  for  a 
license,  offering  to  comply  with  all  the  provisions  of  the  law  ex- 
cepting the  deposit  of  bonds.  The  license  was  refused  and  he,  not- 
withstanding, undertook  to  act  as  agent  for  the  companies,  offered 


466  AVORLD'S  INSURANCE  CONGRESS 

to  issue  policies  in  their  behalf,  and  in  one  instance  did  issue  a 
policy  in  their  name  to  a  citizen  in  Virgina.  For  this  violation 
of  the  statute  he  was  indicted  and  convicted  in  one  of  the  State 
courts,  and  the  judgment  was  affirmed  by  the  Supreme  Court  of 
Appeals  of  the  State.  Error  was  prosecuted  from  this  court,  based 
on,  as  one  of  its  grounds,  the  alleged  violation  of  the  commerce 
clause  of  the  Constitution  of  the  United  States. 

"Replying  to  the  argument  to  sustain  the  contention,  the  court 
said,  by  Mr.  Justice  Field,  that  its  defect  lay  in  the  character  of 
the  business  done.  'Issuing  a  policy  of  insurance  is  not  a  trans- 
action of  commerce.  The  policies  are  simply  contracts  of  indem- 
nity against  loss  by  fire,  entered  into  between  the  corporations  and 
the  assured,  for  a  consideration  paid  by  the  latter.  These  contracts 
are  not  articles  of  commerce  in  any  proper  meaning  of  the  word. 
They  are  not  subjects  of  trade  and  barter,  offered  in  the  market 
as  something  having  an  existence  and  value  independentl.y  of  the 
parties  to  them.  They  are  not  commodities  to  be  shipped  or  for- 
warded from  one  State  to  another,  and  then  put  up  for  sale.  They 
are  like  other  personal  contracts  between  parties  which  are  com- 
pleted by  their  signature  and  the  transfer  of  the  consideration. 
Such  contracts  are  not  interstate  transactions,  though  the  parties 
may  be  domiciled  in  different  States.  The  policies  do  not  take 
effect — are  not  executed  contracts — until  delivered  by  the  agent 
in  Virginia.  They  are,  then,  local  transactions,  and  are  governed 
by  the  local  law.  They  do  not  constitute  a  part  of  the  commerce 
between  the  States  any  more  than  a  contract  for  the  purchase  and 
sale  of  goods  in  Virginia  by  a  citizen  of  New  York,  whilst  in  Vir- 
ginia, would  constitute  a  portion  of  such  commerce.' 

"The  doctrine  announced,  that  insurance  was  not  commerce,  but 
a  personal  contract,  was  emphasized  by  illustrations.  Nathan  v. 
Louisiana,  8  How.  73,  12  L.  Ed.  992,  was  cited,  where  a  tax  on 
money  and  exchange  brokers  who  dealt  in  the  purchase  and  sale 
of  foreign  bills  of  exchange  was  sustained  as  not  conflicting  with 
the  constitutional  power  of  Congress  to  regulate  commerce.  The 
individual  thus  using  his  money,  it  was  said  (quoting  the  cited 
case),  'is  not  engaged  in  commerce,  but  in  supplying  an  instru- 
ment of  commerce.  He  is  less  connected  with  it  than  a  ship- 
builder, without  whose  labor  foreign  commerce  could  not  be  carried 
on.'  The  doctrine  was  further  illustrated  by  bills  of  exchange, 
foreign  and  domestic,  which  it  was  said  were  subject  to  the  regu- 
lating and  taxing  laws  of  the  states.  And  it  was  pointed  out  that 
the  Federal  Government  taxed  not  only  foreign  bills,  but  domestic 
bills  and  promissory  notes,  whether  issued  by  individuals  or  banks 
— a  power  the  government  could  not  have,  it  was  said,  if  bills  and 
notes  were  commerce.  It  was  finally  said:  'If  foreign  bills  may 
thus  be  the  subject  of  State  regulation,  much  more  so  may  con- 
tracts of  insurance  against  loss  by  fire.' 

"We  have  taken  the  trouble  to  make  this  long  excerpt  from  the 
opinion  because,  as  we  have  said,  the  case  is  the  primary  one.  and 
because  its  argument  is  really  exhaustive  of  the  general  principle. 
We  shall  consider  presently  whether  there  is  anything  in  the  case 
at  bar  which  takes  it  out  of  the  principle. 

"In  Ducat  v.  Chicago,  a  law  of  Illinois  came  up  for  review.  It 
was  a  regulation  of  insurance  companies  not  incorporated  by  the 


"WORLD'S  INSURANCE  CONGRESS  467 

State,  and  required  their  agents  to  be  licensed  upon  the  perform- 
ance of  certain  conditions.  Subsequently,  by  the  act  incorporating 
Chicago,  the  legislature  imposed  on  all  foreign  insurance  a  tax  of 
$2  upon  the  $100,  and  at  that  rate  upon  the  amount  of  all  pre- 
miums which  should  be  received.  It  v.as  made  unlawful  for  any 
company  to  transact  business  until  the  payments  was  made.  The 
State  Supreme  Court  sustained  the  tax  and  this  court  alarmed  its 
action,  resting  with  the  decision  on  Paul  v.  Virginia,  the  reasoning 
of  which,  it  was  said,  it  was  not  necessary  to  repeat. 

"Liverpool  &  L.  Life  &  F.  Ins.  Co.  v.  Massachusetts.  The  sub- 
ject came  up  again  for  consideration  in  passing  upon  a  statute  of 
Massachusetts  which  levied  a  tax  upon  all  premiums  charged  or 
received  by  any  fire,  marine,  and  fire  and  marine  insurance  com- 
pany not  incorporated  under  the  laws  of  the  State.  The  law  was 
sustained.  It  was  said:  'The  case  of  Paul  v.  Virginia  decided 
that  the  business  of  insurance,  as  ordinarily  conducted,  was  not 
commerce,  and  that  a  corporation  of  one  State,  having  an  agency 
by  which  it  conducted  that  business  in  another  State,  was  not 
engaged  in  commerce  between  the  States.' 

"Fire  Asso.  of  Philadelphia  v.  New  York.  A  statute  of  New 
York  imposing  taxes  and  conditions  upon  insurance  companies  of 
other  States  was  considered  and  sustained.  Paul  v.  Virginia  was 
cited  for  the  view  that  'issuing  a  policy  of  insurance  is  not  a 
transaction  of  commerce.' 

""We  may  say  here  that  Paul  v.  Virginia  was  also  cited  for  the 
proposition  that  the  right  of  a  foreign  corporation  to  do  business 
in  a  State  other  than  that  of  its  creation  depends  wholly  upon  the 
will  of  such  other  States.  This  proposition,  it  was  said,  was  sus- 
tained by  previous  cases,  and  it  has  been  sustained  by  many  sub- 
sequent cases.  Necessarily  it  could  not  be  applied  to  foreign  in- 
surance companies  if  the  business  of  insurance  is  commerce.  In 
other  words,  that  right  exists  and  has  onlv  an  exception,  was 
said  in  Hooper  v.  California,  155  U.  S.  648,  39  L.  Ed.  297,  Inters. 
Com.  Rep.  610,  15  Sup.  Ct.  Rep.  207,  'where  a  corporation  cre- 
ated by  one  State  rests  its  right  to  enter  another  and  to  engage 
in  business  therein  upon  the  federal  nature  of  its  business.'  And 
that  was  the  contention  in  Hooper  v.  California,  asserting  the 
invalidity  of  the  statute  of  the  State  making  it  a  misdemeanor  for 
any  person  in  that  State  to  procure  insurance  for  a  resident  in 
the  State  from  an  insurance  company  not  incorporated  under 
its  laws.  The  argument  was  that  inasmuch  as  the  contract  in- 
volved was  one  for  marine  insurance,  it  was  a  matter  of  interstate 
commerce,  and  as  such  beyond  the  reach  of  State  authority,  and 
included  among  the  exceptions  to  the  rule.  It  was  replied  by  the 
court :  '  This  proposition  involves  an  erroneous  conception  of  what 
constitutes  interstate  commerce.  That  the  business  of  insurance 
does  not  generally  pertain  to  such  commerce  has  been  settled  since 
the  case  of  Paul  v.  Virginia.'  To  the  attempt  to  distinguish  be- 
tween policies  of  marine  insurance  and  policies  of  fire  insurance, 
and  thus  take  the  former  out  of  the  rule  of  Paul  v.  Virginia,  it 
was  answered:  'It  ignores  the  real  distinction  upon  which  the 
general  rule  and  its  exceptions  are  based,  and  which  consists  in 
the  difference  between  interstate  commerce  or  an  instrumentality 
thereof  on  the  one  side  and  the  mere  incidents  which  may  attend 


468  WORLD'S  INSURANCE  CONGRESS 

the  carrying  on  of  such  commerce  on  the  other.'  And  it  was 
pointed  out  that  if  the  power  to  regulate  interstate  commerce  ap- 
plied to  all  of  the  incidents  of  such  commerce  and  '  to  all  contracts 
which  might  be  made  in  the  course  of  its  transaction,  that  power 
would  embrace  the  entire  sphere  of  mercantile  activity  in  any  way 
connected  with  trade  between  the  States;  and  would  exclude  State 
control  over  many  contracts  purely  domestic  in  their  nature. '  And 
then,  sweeping  away  the  distinction  between  the  different  subject 
matters  of  insurance  contracts,  and  the  different  events  indemni- 
fied against,  and  declaring  the  principle  applicable  to  all  and  de- 
terminative of  the  regulating  power  of  the  State  over  all,  it  was 
said:  'The  business  of  insurance  is  not  commerce.  The  contract 
of  insurance  is  not  an  instrumentality  of  commerce.  The  mak- 
ing of  such  a  contract  is  a  mere  incident  of  commercial  inter- 
course, and  in  this  respect  there  is  no  difference  whatever  between 
insurance  against  fire  and  insurance  against  the  "perils  of  the 
sea."  ' 

' '  This  declaration  was  repeated  and  applied  in  Noble  v.  Mitchell, 
164  U.  S.  368,  41  L.  Ed.  472,  17  Sup.  Ct.  Rep.  110,  and  in  New 
York  L.  Ins.  Co.  v.  Cravens,  178  U.  S.  389,  44  L.  Ed.  1116,  20 
Sup.  Ct.  Rep.  962.  The  latter  case  has  special  application,  for 
the  plaintiff  in  error  here  was  the  plaintiff  in  error  there,  and  the 
case  concerned  life  insurance  companies  and  their  policies.  In 
that  case  it  was  contended  that  a  policy  of  mutual  life  insurance 
was  an  interstate  contract  and  the  parties  might  choose  its  'appli- 
catory  law.'  The  contention  was  made  in  many  ways  and  with 
great  amplitude  of  argument  and  illustration.  It  was  urged  that 
on  account  of  the  mutual  character  of  the  company  it  was  the 
administrator  of  a  fund  collected  from  its  policyholders  in  differ- 
ent States  and  countries  for  their  benefit.  And  the  extent  of  the 
business  was  displayed  by  a  stipulation  of  the  parties  as  follows: 
'That  during  the  year  1886  and  prior  to  the  issuance  of  the  policy 
sued  upon,  the  amount  of  policies  issued  by  defendant  to  citizens 
of  Missouri  was  $1,617,985,  and  the  amount  of  insurance  in  force 
on  the  lives  of  citizens  of  IMissouri  on  December  31,  1886,  was 
$8,886,542,  and  the  total  amount  of  policies  issued  by  defendant 
in  said  year  1886  was  $85,178,294,  and  the  total  amount  of  policies 
in  force  on  December  31,  1886,  issued  bv  defendant,  was  $304,- 
373,540.' 

''It  was  also  urged  that  modern  life  insurance  had  taken  on 
essentially  a  national  and  international  character,  and  that  when 
Paul  V.  Virginia  was  decided  the  business  was  'to  a  great  extent 
local ;  that  is,  conducted  through  the  domestic  contracts  bv  stock 
companies.  The  great  and  commanding  organizations  of  the  pres- 
ent day  had  hardly  begun  the  amazing  developments  which  have 
made  them  the  greatest  associations  of  administrative  trusts  of  the 
business  world.' 

"These  contentions  were  earnestly  made;  the  repl.v  to  them 
deliberately  meditated  and  its  extent  fully  appreciated.  The  rul- 
ing in  Paul  V.  Virginia  and  other  cases  was  applied.  We  omitted 
the  reasoning  by  which  they  demonstrated,  we  said,  the  correct- 
ness of  their  conclusion.  We,  however,  repeated  that  'the  business 
of  insurance  is  not  commerce.  The  contract  of  insurance  is  not  an 
instrumentality  of  commerce.     The  making  of  such  a  contract  is 


WORLD'S  INSURANCE  CONGRESS       469 

a  mere  incident  of  commercial  intercourse,  and  in  this  respect  there 
is  no  difference  whatever  between  insurance  against  fire  and  in- 
surance against  the  "perils  of  the  sea"  '  and,  we  added,  that 
'against  the  uncertainty  of  man's  mortality.' 

"In  Nutting  v.  Massachusetts  a  statute  of  the  State  was  sus- 
tained which  required  a  licensing  of  the  agent  of  a  foreign  in- 
surance company  not  admitted  to  do  business  in  the  State,  and 
made  it  a  crime  to  solicit  insurance  of  a  resident  in  violation  of 
the  statute.  The  principle  of  the  prior  cases  which  we  have  re- 
ferred to  was  affirmed. 

"This  detail  shows  what  the  cases  decided.  Were  they  rightly 
decided?  The  reasoning  of  the  cases  anticipate  and  answer  the 
question,  and  it  would  rack  ingenuity  to  attempt  to  vary  its  ex- 
pression or  more  aptly  illustrate  it.  A  policy  of  insurance,  the 
cases  declare,  is  a  personal  contract,  a  mere  indemnity,  for  a  con- 
sideration, against  the  happening  of  some  contingent  event  which 
may  bring  detriment  to  life  or  property,  and  its  character  is  the 
same  no  matter  what  the  event  insured  against,  whether  fire  or 
hurricane,  acts  of  man  or  acts  of  God,  storms  on  land  or  storms  on 
sea,  death  or  lesser  accident.  The  same  event  may  involve  both 
life  and  property,  precipitating  the  obligation  of  the  policies.  Nor 
does  the  character  of  the  contracts  change  by  their  numbers  or  the 
residence  of  the  parties.  The  latter  is  made  much  of  in  this 
case.  It  was  made  much  of  in  the  Cravens  case.  The  effort 
has  been  to  give  a  special  locality  to  the  contracts  and  de- 
termine their  applicatory  law,  and,  indeed,  to  a  centralization 
of  control,  to  employ  local  agents,  but  to  limit  their  power  and 
judgment.  To  accomplish  the  purpose  there  is  necessarily  a  great 
and  frequent  use  of  the  mails,  and  this  is  elaborately  dwelt  on  by 
the  insurance  company  in  its  pleading  and  argument,  it  being 
contended  that  this  and  the  transmission  of  premiums  and  the 
amounts  of  the  policies  constitute  a  'current  of  commerce  among 
the  States.'  This  use  of  the  mails  is  necessary,  it  may  be,  to  the 
centralization  of  the  control  and  supervision  of  the  details  of  the 
business ;  it  is  not  essential  to  its  character.  And  we  may  say,  in 
passing,  that  such  effort  has  led  to  regulating  legislation,  but  that 
it  cannot  determine  its  validity  was  decided  in  the  Cravens  case. 
See  also  Equitable  Life  Assur.  Soc.  v.  Clements  (Equitable  Life 
Assur.  Soc.  V.  Pettus),  140  U.  S.  226,  36  L.  Ed.  497,  11  Sup.  Ct. 
Rep.  822. 

"This  legislation  is  in  effect  attacked  by  the  contention  of  the 
insurance  company.  We  have  already  pointed  out  that  if  insurance 
is  commerce  and  becomes  interstate  commerce  whenever  it  is  be- 
tween citizens  of  different  States,  then  all  control  over  it  is  taken 
from  the  State,  and  the  legislative  regulations  which  this  court  has 
heretofore  sustained  must  be  declared  invalid. 

"The  number  of  transactions  does  not  give  the  business  any  other 
character  than  magnitude.  If  it  did,  the  department  store  which 
deals  with  every  article  which  covers  or  adorns  the  human  body, 
or,  it  may  be,  nourishes  it,  would  have  on  character,  while  its 
neighbor,  humble  in  the  variety  and  extent  of  its  stock,  would  have 
another.  Nor,  again,  docs  the  use  of  the  mails  determine  anything. 
Certainly  not  that  which  takes  place  before  and  after  the  transac- 
tion between  the  plaintiff,  and  its  agents  in  secret  or  in  regulation 


470  WORLD'S  INSURANCE  CONGRESS 

of  their  relations.  But  put  agents  to  one  side  and  suppose  the  insur- 
ance company  and  the  applicant  negotiating  or  consummating  a 
contract.  That  they  may  live  in  different  States  and  hence  use  the 
mails  for  their  communications  does  not  give  character  to  what 
they  do ;  cannot  make  a  personal  contract  the  transportation  of 
commodities  from  one  State  to  another,  to  paraphrase  Paul  v. 
Virginia.  Such  might  be  incidents  of  a  sale  of  real  estate  (cer- 
tainly nothing  can  be  more  immobile).  Its  transfer  may  be  nego- 
tiated through  the  mails  and  completed  by  the  transmission  of  the 
consideration  and  the  instrument  of  transfer  also  through  the 
mails. 

"It  is  contended  that  the  policies  are  subject  to  sale  and  trans- 
fer, may  be  used  for  collateral  security  and  other  commercial  pur- 
poses. This  may  be,  but  this  use  of  them  is  after  their  creation — 
a  use  by  the  insured,  not  by  the  insurer.  The  quality  that  is  thus 
ascribed  to  them  may  be  ascribed  to  any  instrument  evidencing  a 
valuable  right.  The  argument  was  anticipated  in  Paul  v.  Vir- 
ginia, citing  Nathan  v.  Louisiana,  where,  as  we  have  seen,  a  tax  on 
money  and  exchange  brokers  who  dealt  in  the  purchase  and  sale 
of  foreign  bills  of  exchange  was  sustained  as  not  conflicting  with 
the  constitutional  power  of  Congress  to  regulate  commerce  among 
the  States  or  with  foreign  nations.  , 

"It  is  contended  that  Paul  v.  Virginia  and  the  cases  which  fol- 
low it  must  be  limited,  as  it  is  contended  'the  facts  herein  did 
limit  them,  to  intrastate,  not  interstate,  contracts,'  and  that  if 
they  be  not  so  limited  the  Lotterv  case  (Champion  v.  Ames),  188 
U.  S.  321,  47  L.  Ed.  492,  23  Sup.'Ct.  Rep.  321,  13  Am.  Crim.  Rep. 
561,  and  International  Text  Book  Co.  v.  Pigg,  217  U.  S.  91,  54  L. 
Ed.  678,  27  L.  R.  A.  (N.  S.)  493,  30  Sup.  Ct.  Rep.  481,  18  Ann. 
Cas.  1103,  cannot  stand. 

"The  basis  of  this  contention  necessarily  is  the  insistence  that 
the  contracts  in  Paul  v.  Virginia  and  the  succeeding  cases  were 
intrastate  contracts  while  the  contracts  in  the  case  at  bar  are  inter- 
state contracts.  But  this  is  a  false  characterization  of  the  con- 
tracts. The  decision  of  the  cases  is  that  contracts  of  insurance 
are  not  commerce  at  all,  neither  State  nor  interstate.  This  is  the 
obstacle  to  the  contention  of  the  insurance  company.  The  com- 
pany realizes  it  to  be  an  obstacle  and  has  attempted  to  remove  it 
b}^  detailing  the  manner  of  conducting  its  business  as  demonstrat- 
ing that  its  policies  are  interstate  contracts.  We  have  replied  to 
the  attempt  and  shown  that  its  manner  of  business  has  no  such 
effect.  It  follows  necessarily,  therefore,  that  neither  the  Lottery 
case  nor  the  Pigg  case  impugns  the  authority  or  the  application  of 
the  cited  cases.  Thej^  the  Lottery  case  and  the  Pigg  case,  were 
concerned  with  transactions  which  involved  the  transportation  of 
property,  and  were  not  mere  personal  contracts. 

"There  are  cognate  ca.ses  to  the  cited  cases,  of  contracts  incident 
to  commerce,  but  not  of  themselves  commerce.  In  Williams  v. 
Fears,  179  U.  S.  270,  45  L.  Ed.  186,  21  Sup.  Ct.  Rep.  128.  there 
was  levied  by  the  State  of  Georgia  a  tax  upon  each  emigrant  agent 
or  employer  or  employee  of  such  agent,  doing  business  in  the  State. 
The  law  imposing  the  tax  was  attacked  as  a  violation  of  the  com- 
merce clause  of  the  Constitution  of  the  United  States.  Commerce 
was  defined,  quoting  Mr.  Justice  Field,  in  Mobile  County  v.  Kim- 


WORLD'S  INSURANCE  CONGRESS       471 

ball,  102  U.  S.  691-702,  26  L.  Ed.  238-241,  to  'consist  in  inter- 
course and  traffic,  including  in  these  terms  nagivation  and  the 
transportation  aJid  transit  of  persons  and  property,  as  well  as  the 
purchase,  sale  and  exchange  of  commodities.'  The  court  consid- 
ered the  definition  comprehensive  enough  for  the  purpose  of  the 
case,  and,  testing  its  application,  said,  by  Mr.  Chief  Justice  Fuller: 
'These  agents  were  engaged  in  hiring  laborers  in  Georgia,  to  be 
employed  beyond  the  limits  of  the  State.  Of  course,  transporta- 
tion must  eventually  take  place  as  the  result  of  such  contracts, 
but  it  does  not  follow  that  the  emigrant  agent  was  engaged  in 
transportation.  The  conclusion  was  supported  by  cases,  among 
others,  Paul  v.  Virginia,  and  Hooper  v.  California.  On  the  au- 
thority of  the  same  cases  and  New  York  L.  Ins.  Co.  v.  Cravens, 
in  AVare  &  Leland  v.  Mobile  County,  209  U.  S.  405,  52  L.  Ed.  855, 
28  Sup.  Ct.  Rep.  526,  14  Ann.  Cas.  1031,  it  was  held  that  con- 
tracts by  brokers  for  the  sale  of  cotton  for  future  delivery,  where 
the  transactions  were  closed  by  contracts  completed  and  executed 
in  02ie  State,  although  the  orders  were  received  from  another 
State,  were  legally  subject  to  a  tax.  Such  contracts,  it  was  said, 
were  not  'the  subjects  of  interstate  commerce,  any  more  than 
in  the  insurance  cases  where  the  policies  are  ordered  and  delivered 
in  another  State  than  that  of  the  residence  and  office  of  the  com- 
pany. 

"In  Engel  v.  O'Malley,  219  U.  S.  128,  55  L.  Ed.  128,  31  Sup. 
Ct.  Rep.  190,  a  law  of  New  York  forbade  individuals  or  partner- 
ships to  engage  in  the  business  of  receiving  deposits  of  money  or 
for  the  purpose  of  transmission  to  another,  or  for  any  other  pur- 
pose, without  a  license  from  the  comptroller.  It  was  attacked  as 
a  violation  of  the  commerce  clause  of  the  Constitution.  The  case 
was  decided  to  be  similar  in  principle  to  AVare  &  Leland  v.  Mobile 
County  and  Williams  v.  Fears,  and  the  law  was  sustained. 

"Further  discussion,  we  think,  is  unnecessary;  and  we  have 
gone  beyond  the  citing  of  the  authoritative  cases  only  in  defer- 
ence to  the  able  and  earnest  argument  of  counsel." 

In  view  of  this  final  disposition  of  the  question,  it  will  be  per- 
ceived that  under  the  organic  law  of  the  nation,  as  uniformly  in- 
terpreted by  the  court  of  last  resort.  Federal  supervision  of  life 
insurance  is  no  longer  even  a  remote  possibility.  Indeed,  it  seems 
inexplicable  that  any  lawyer  could  have  persuaded  himself  other- 
wise these  many  years  since. 

But  it  is  argued  by  able  and  learned  men,  experienced  in  life 
insurance  in  all  its  phases,  that  so  great  and  pressing  is  the  neces- 
sity for  Federal  supervision  that  a  nation-wide  campaign  should 
at  once  be  inaugurated  to  procure  an  amendment  to  the  organic 
law  which  will  confer  upon  the  Federal  Government  power  to  take 
charge  of,  control  and  supervise  all  of  the  business  and  activiMos 
of  life  insurance  companies  "throughout  the  United  States  and  its 
territories  and  possessions." 

Passing  for  the  moment  the  question  of  necessity  and  desirabil- 
ity, we  meet  at  once  the  question  which  naturally  suggests  itself: 
Is  it  within  the  range  of  possibility  to  procure  such  an  amendment 


472  WORLD'S  INSURANCE  CONGRESS 

to  the  Federal  Constitution  as  will  confer  supervision  and  control 
of  life  insurance  upon  the  Federal  Government,  to  the  exclusion  of 
the  States? 

It  is  said  that  life  insurance  is  now  paying  to  the  several  States 
seventeen  million  dollai-s  annually  for  State  supervision.  Con- 
ceding this,  it  must  nevertheless  be  admitted  that  these  States, 
under  our  present  scheme  of  government,  are  exercising  sovereign 
rights  and  powers  in  supervising  and  collecting  taxes  upon  this 
business.  It  is  true  that  these  States  may  surrender,  if  they  will, 
these  rights,  this  sovereign  power,  to  the  Federal  Government. 
If  two-thirds  of  both  houses  of  Congress  shall  propose  the  amend- 
ment under  consideration ;  or  if,  upon  application  of  two-thirds  of 
the  States,  a  Constitutional  Convention  shall  be  called  that  can  be 
induced  to  propose  the  amendment,  and  if  three-fourths  of  the 
States  can  thereafter  be  found  sufficiently  willing  to  surrender 
these  rights  and  powers  to  ratify  such  amendment,  then,  but  not 
until  then,  may  Federal  supervision  become  an  accomplished  fact. 
Does  any  one  who  comprehends  our  wonderful  system  of  govern- 
ment, who  is  at  all  familiar  with  the  spirit  of  our  laws,  who  ap- 
preciates in  any  measurable  degree  the  trend  of  thought  and 
temper  of  the  people  believe  that  this  can  be  done  ?  Given  a  people 
who  would  be  so  unselfish,  so  generous,  so  magnanimous,  and  what 
need  were  there  to  wrest  from  thm  State  supervision  by  an 
amendment  to  the  organic  law?  Doubtless,  upon  simple  request 
to  such  a  people,  they  would  graciously  and  promptly  abate  such 
taxes,  license  fees  and  regulations.  These  people  to  whom  we 
must  go  for  the  ratification  of  the  amendment  are  the  same  people 
who  have  imposed  and  are  collecting  the  taxes  and  fees,  and  who 
have  prescribed  and  are  now  exercising  the  regulations  from 
which  it  is  sought  to  escape  through  the  medium  of  Federal  super- 
vision. 

In  this  discussion  it  is  assumed  that  no  one  desires  both  Federal 
and  State  supervision.  It  is  taken  for  granted  that  the  most 
earnest  champions  of  Federal  supervision  desire  it  for  no  ulterior 
purpose,  but  only  because  it  will  result  in  wholesome,  efficient, 
single,  uniform  regulation  at  a  greatly  reduced  cost,  and  that 
there  is  reasonable  probability  of  the  accomplishment  of  these  re- 
sults. 

The  amendment  proposed  which  it  is  hoped  will  prove  a  panacea 
for  all  our  ills  reads:  "The  Congress  shall  have  power  to  regu- 
late the  business  or  commerce  of  insurance,  throughout  the  Ignited 
States  and  its  territories  and  possessions. ' '  If  this  language  were 
to  become  a  part  of  the  Nation's  fundamental  law,  many  and  va- 
ried might  bo  the  statutes  enacted  in  pursuance  thereof,  but  no  act 
falling  within  its  purview  could  deprive  the  states  of  the  right 
to  tax  tangible  assets,  in  whatever  form,  of  foreign  insurance 
corporations  found  at  any  given  time  in  the  St<ite,  or  to  police  the 
business  and  safeguard  the  rights  of  policyholders.  Life  insur- 
ance business  would  continue  to  be  carried  on  by  corporations  as 


WORLD  S  INSURANCE  CONGRESS       473 

now.  These  corporations  derive  their  charter,  powers  and  rights 
from  the  States  of  their  respective  domiciles ;  and  the  right  of  any 
corporation  of  any  given  State  to  enter  and  transact  business 
in  a  sister  State  must,  subject  only  to  certain  limitations,  depend 
upon  the  doctrine  of  comity  between  the  States.  The  great  trunk 
line  railroads  of  the  country  are  all  engaged  in  interstate  commerce 
and  yet,  notwithstanding  the  wide  and  far-reaching  jurisdiction, 
supervision  and  control  of  the  Interstate  Commerce  Commission, 
we  find  that  as  to  taxation,  operating  crews,  character  of  head- 
lights, track  elevation,  grade  crossings  and  many  other  subjects, 
the  States  through  which  these  lines  extend  are  supervising  quite 
thoroughly.  The  great  express  companies,  telegraph  and  tele- 
phone lines  furnish  a  further  illustration  of  what  States  can  do 
and  will  do  in  the  way  of  supervision,  control  and  taxation  of  in- 
strumentalities of  interstate  commerce,  operating  within  their 
borders.  Look  in  whatever  direction  you  may,  no  signs  will  be 
discovered  indicating  the  remotest  tendency  on  the  part  of  the 
States,  or  of  the  people  composing  them,  to  increase  the  power  of 
the  Federal  Government  at  their  own  expense.  The  Federal  Gov- 
ernment, from  the  beginning,  has  been  an  institution  founded  upon 
delegated  powers  and  so  must  it  continue  while  the  republic  en- 
dures. It  is  a  mistake  to  assume  that  sovereignty  does  not  repose 
in  the  States.  They  possess  all  sovereignty  except  that  which  has 
been  reserved  and  forbidden,  while  the  Federal  Government  pos- 
sesses only  what  power  has  been  delegated  to  it. 

In  our  century  and  a  quarter  of  growth  and  experience  seven- 
teen amendments  have  been  added  to  the  Constitution.  The  first 
ten  of  these  were  submitted  by  the  first  Congress  and  were  ratified 
and  became  effective  in  1791.  They  constituted  what  is  popularly 
known  as  "The  American  Bill  of  Rights,"  and  were  all  designed 
to  secure  the  individual  citizen  and  the  States  against  encroach- 
ments of  Federal  power.  The  Eleventh  and  Twelfth  Amendments 
were  designed  to  correct  minor  defects  in  the  working  of  the  Con- 
stitution. Following  these  came  the  Thirteenth,  Fourteenth  and 
Fifteenth  Amendments,  forbidding  slavery,  defining  citizenship 
and  securing  the  rights  of  suffrage  to  negroes.  This  group  of 
amendments  marks  a  political  cataclysm  and  was  deemed  neces- 
sary to  secure  and  confirm  the  results  of  an  unhappy  war.  Con- 
sent of  three-fourths  of  the  States  was  and  could  only  have  been 
obtained  through  abnormal  methods,  under  abnormal  conditions. 
The  only  other  changes  in  our  organic  law  are  marked  by  the  Six- 
teenth Amendment,  authorizing  a  levy  of  a  general  income  tax, 
and  the  Seventeenth  Amendment,  providing  for  the  election  of 
United  States  senators  by  direct  vote  of  the  people. 

We  look  in  vain  for  any  tendency  or  disposition  here  upon  the 
part  of  the  people  or  of  the  States  to  increase  the  power  of  the 
Federal  Government  by  minimizing  their  own.  While,  upon  the 
other  hand,  we  need  only  observe  the  action  of  the  several  States  in 
creating  railroad  commissions.  State  tax  boards,  insurance  depart- 


474  WORLD'S  INSURANCE  CONGRESS 

ments,  utility  commissions  and  other  agencies,  through  which  mul- 
tiplied State  laws  are  being  administered,  both  as  to  intrastate  and 
interstate  business,  to  demonstrate  tiie  proposition  that  no  amend- 
ment, the  effect  of  which  will  be  to  take  from  the  States  a  single 
right  now  being  exercised  in  respect  to  insurance,  and  to  confer 
that  right  upon  the  Federal  Government,  can  ever  even  be  pro- 
posed, much  less  ratified.  The  most,  therefore,  that  any  one  may 
expect  is  State  supervision  plus  Federal  supervision. 

State  sovereignty.  State  rights  are  as  sacred  and  as  zealously 
guarded  to-day  as  they  were  upon  the  adoption  of  the  Federal 
Constitution. 

He  who  has  stopped  to  reflect  upon  our  system  of  civil  govern- 
ment is  driven  to  see  that  "This  Nation  is  a  commonwealth  of 
commonwealths,  a  republic  of  republics.  A  State,  while  one,  is 
nevertheless  composed  of  other  States  even  more  essential  to  its 
existence  than  it  is  to  theirs."  He  who  thinks  otherwise  has  read 
the  history  of  our  country  with  an  indifferent  purpose  and  fails 
signally  to  comprehend  the  genius  and  spirit  of  our  laws. 

In  view  of  the  fact  that  Federal  supervision,  if  it  can  be  se- 
cured at  all,  means  double  supervision,  is  it  desirable  or  feasible, 
from  a  business  or  economic  standpoint?  The  answer  to  this 
question  necessarily  depends  upon  and  involves  the  fundamental 
plans,  policies  and  purposes  of  the  corporate  bodies  engaged  in  the 
business.  If  life  insurance  will  recognize  the  fact  that  it  is  a  great 
business  enterprise ;  that  its  field  of  activities  is  boundless ;  that 
its  business  principles  must  rest  upon  a  scientific  basis;  that  its 
plan  and  purpose,  independent  of  government  aid  other  than  the 
protection  of  law  accorded  all  legitimate  business  enterprises,  is 
to  write,  conduct  and  administer  life  insurance  as  such;  and  that 
its  functions  must  be  discharged  pursuant  to  the  laws  which  safe- 
guard and  protect  it,  then  I  make  bold  to  say  that  State  super- 
vision, with  its  ever-increasing  efficiency,  uniformity  and  fairness, 
is  immeasurably  preferable  to  Federal  supervision  intermingled, 
as  it  must  inevitably  be,  with  State  supervision,  the  progress  of 
which  must  necessarily  be  retarded  by  the  confusion  which  the 
new  system  would  inevitably  entail. 

If,  however,  life  insurance  should  conceive  that  by  virtue  of  its 
character  and  magnitude,  its  influence  and  power  and  the  supreme 
wisdom  of  its  prudential  managers,  it  is  at  least  a  coordinate 
branch  of  the  government ;  if  it  should  convince  itself  that  among 
its  functions  were  the  privileges  of  making  and  unmaking  execu- 
tives, legislators,  jurists,  and  creating  and  dominating  governmen- 
tal commissions;  and  if  it  should  conclude  that  it  would  best  pro- 
mote its  own  welfare  by  combining  and  assembling  under  one  gi- 
gantic, colossal  management,  the  directors  of  which  would  be 
hailed  as  world  leaders,  international  statesmen,  then,  and  in  such 
event,  would  it  desire  Federal  supervision  at  any  cost.  But  a 
desire  bom  of  a  dream  so  chimerical,  emanating  from  a  conception 
so  fallacious,  springing  from  a  motive  so  vicious  and  inimical  to 


WORLD'S  INSURANCE  CONGRESS       475 

wholesome  government,  can  be  of  no  controlling  force  or  aid  to  us 
in  determining  what  the  companies,  of  which  the  American  Life 
Convention  is  composed,  most  need. 

This  body  from  the  day  of  its  birth  has,  in  good  faith,  endeav- 
ored to  accommodate   itself  to   State  supervision.     Its  members 
have  rendered  every  aid  within  their  power  to  the  several  State 
departments  with  which  they  have  come  in  close  touch,  to  systema- 
tize, improve  and  unify  departmental  regulation  and  supervision. 
The  departments  in  the  main  have  met  the  companies  more  than 
half  waj  in  their  efforts  to  improve  the  business.     The  charges 
made   by   champions  of   Federal  supervision   that   State   depart- 
ments are  dominated  by  partisan  politics  and  characterized  by  in- 
efficiency, are,  except  as  to  isolated  cases,  absolutely  without  foun- 
dation.    To  the  States  properly  belongs  the  credit  for  the  organi- 
zation of  the  National  Convention  of  Insurance  Commissioners,  a 
body  of  conscientious,  tireless,  thoroughgoing  men,  whose  efforts 
have  contributed  more  to  the  general  welfare  of  insurance,  con- 
sidered both  from  the  standpoint  of  the  company  and  of  the  pol- 
icyholder, than  Federal  supervision  could  possibly  contribute  in 
a  century  to  come.    No  ulterior  purpose  has  dominated  their  activ- 
ity.    No  partisan  politics  has  biased  their  judgment.     No  special 
interest  or  company,  large  or  small,  has  swerved  them  in  the  dis- 
charge of  their  duty.     Cooperating  with  them  the  State  depart- 
ments and  the  insurance  companies  have  given  us  regulation  and 
supervision  which  in  an  increasing  measure  is  coming  to  be  based 
upon  knowledge  of  conditions,  comprehensions  of  the  necessities 
of  the  situation,  and  a  more  intimate  personal  acquaintance  among 
those  who  conduct  and  those  who  supervise  the  business.     Super- 
vision of  this  character  has  been,  and  I  assume  continues  to  be, 
the  aim  and  hope  of  this  organization.     Indeed,  one  of  the  tenets 
of  its  faith,  one  of  the  prime  purposes  of  its  organization,  was 
opposition  to  Federal  supervision.     To  my  mind  the  keynote  to 
improvement  in  departmental  supervision  was  sounded  by  Charles 
F.  Coffin,  Vice  President  and  General  Counsel  of  the  State  Life,  in 
his  virile,  keen  and  comprehensive  presentation  of  the  report  of 
the  Committee  on  Departmental  Supervision  to  this  Convention 
at  its  last  annual  meeting.     Intelligent  and  efficient  supervision 
from  Washington,  in  the  very  nature  of  things,  cannot  be  hoped 
for.    The  ills  of  which  complaint  is  made,  under  State  supervision, 
must  necessarily   and   inevitably  become  augmented   and   aggra- 
vated under  supervision  from  either  our  present  Interstate  Com- 
merce Commission  or  by  means  of  a  vast  Federal  insurance  com- 
mission, created  for  the  purpose.     From  where,  think  you,  would 
come  the  members  of  a  Federal  insurance   commission?     From 
what  school   of   insurance   thought   would    Federal   actuaries  be 
chosen?     How  long  would  it  be  until  your  rates  would  be  arbi- 
trarily fixed  by  an  authority  that  considered  neither  difference  in 
time,  place  or  conditions?    How  long  would  it  be  until  the  cost  of 
procuring  business  would  be  governed  by  rules  inflexible,  until 


476  WORLD'S  INSURANCE  CONGRESS 

j^our  advertising  would  be  censored,  and  your  initiative  destroyed  ? 
What  is  to  become  of  the  strategic  position  you  now  hold  in  your 
own  State,  which  has  of ttimes  served  you  so  well  ? 

It  seems  to  me  that  our  attitude  toward  Federal  supervision 
is  that  we  wouldn't  if  we  could  and  we  couldn't  if  we  would. 
If  this  be  correct,  it  certainly  follows  that  it  would  be  extremely 
unwise  from  our  point  of  view  to  join  in  an  effort  to  procure  an 
amendment  to  the  Federal  Constitution  or  to  commit  the  World's 
Insurance  Congress  to  such  policy. 

No  good  can  possibly  come,  while  much  harm  might  result, 
from  such  agitation. 

Our  paths  of  duty  lie  straight  before  us.  There  has  never 
been,  nor  will  there  ever  be,  any  "royal  road  to  success."  Many 
and  perplexing  will  be  the  problems  which  we  must  solve.  Diffi- 
cult, aye,  all  but  insurmountable,  the  obstacles  which  we  must 
encounter.  But  these  problems  we  shall  solve,  these  obstacles  over- 
come, if  undaunted  we  adhere  strictly  and  loyally  to  principle 
and  to  duty,  forgetting  neither  our  obligations  to  our  companies, 
nor  our  policyholders,  nor  the  State. 


THE  WORLD'S  INSURANCE   CONGRESS— ITS  AIMS  AND 
OPPORTUNITIES 

By  Forrest  F.  Dryden 
President,  The  Prudential  Insurance  Company  of  America 

The  World's  Insurance  Congress  of  1915  should  prove  a  mem- 
orable event  in  the  annals  of  insurance  in  all  its  branches.  Just 
as  the  opening  of  the  Panama  Canal  emphasizes  the  vast  enlarge- 
ment of  the  sphere  of  commercial  relations  throughout  the  world, 
so  the  World's  Congress  of  Insurance  foreshadows  broader  na- 
tional and  international  conceptions  of  a  business  which,  by  com- 
mon consent,  now  ranks  foremost  among  the  institutions  making 
for  human  betterment.  On  the  occasion  of  the  Louisiana  Purchase 
Exposition  of  1904,  an  International  Congress  of  Arts  and  Sciences 
was  held  in  St.  Louis,  in  the  proceedings  of  which  insurance  for 
the  first  time  received  equal  consideration  with  other  sciences 
and  arts  represented  at  that  important  gathering.  In  connec- 
tion with  the  World's  Congress  of  Insurance  in  1915,  it  is 
understood  that  an  effort  is  to  be  made  to  bring  about  a 
thorough  presentation  of  all  the  essential  facts  and  phases  of 
insurance  as  a  social  and  economic  institution.  It  is  to  be  hoped, 
however,  that  special  consideration  will  be  given  to  the  status  of 
insurance  as  an  element  of  commerce  in  the  furtherance  of  the 
ro((uired  economic  security  of  the  American  people,  best  illustrated 
in  the  rebuilding  of  the  new  San  Francisco  out  of  the  a.shes  of  the 
old.     No  event  in  insurance  history  illustrates  more  forcibly  the 


WORLD'S  INSURANCE  CONGRESS       477 

practical  value  of  insurance,  not  in  one  branch  only,  but  in  all. 
It  is  therefore  to  be  hoped  that  insurance  will  be  well  represented 
at  the  Exposition  itself,  so  that  the  public  may  obtain  a  com- 
plete understanding  of  the  remarkable  achievements  and  the  un- 
questionable progress  made  by  insurance  in  all  its  branches  during 
recent  years.  An  exhibit  will  be  made  by  The  Prudential  which 
will  be  educational  and  scientific,  and  in  connection  with  which 
every  phase  of  the  life  insurance  business  will  be  set  forth  in  con- 
formity to  approved  methods.  The  exhibit  will  not  be  limited  to 
the  methods  and  results  of  insurance,  but  includes  an  extended 
consideration  of  insurance  history  from  the  earliest  times,  insur- 
ance practice  throughout  the  world,  insurance  architecture  as  it 
appears  in  the  buildings  of  the  leading  institutions,  insurance 
mortality  experience,  and  last  but  not  least,  insurance  in  its  re- 
lation to  public  welfare  as  illustrated  by  the  numerous  problems 
of  public  health  and  personal  hygiene  practically  throughout  the 
entire  Western  Hemisphere.  The  Prudential  exhibit  will  be  in  the 
section  on  Social  Economy,  which  has  finally  been  assigned  space 
in  the  Mines  Building  on  account  of  unavoidable  limitations  of 
space  in  the  Education  Building,  as  originally  planned. 

The  present  occasion  suggests  a  few  subjects  which  can  prop- 
erly receive  special  consideration  on  the  part  of  the  World's  Insur- 
ance Congress,  and  in  connection  with  the  discussion  of  which  the 
foremost  authorities  might  express  judgment  for  the  betterment 
of  conditions  under  which  the  business  can  be  developed  to  a  still 
higher  degree  of  usefulness  in  the  years  to  come. 

First:  The  subject  of  taxation  of  insurance  as  a  social  and 
economic  problem  should  receive  the  qualified  attention  not  only 
of  men  familiar  with  the  practice  of  insurance,  but  also  of  econ- 
omists and  those  versed  in  the  intricacies  of  public  finance.  The 
amount  paid  in  taxes,  licenses  and  fees  by  life  insurance  compa- 
nies alone  in  1912  was  $15,000,000,  equivalent  to  2.24  per  cent 
of  the  premium  receipts. 

Second:  The  commercial  aspects  of  insurance  should  be  brought 
out  in  a  thorough  study  of  every  phase  of  insurance  activity  along 
new  lines,  so  as  to  establish  beyond  a  question  of  reasonable  doubt 
that,  as  a  matter  of  fact  and  historical  experience,  insurance  is, 
and  always  has  been,  an  integral  element  of  commerce  in  the  com- 
mercial relations  of  mankind. 

Third:  The  more  effective  and  comprehensive  supervision  of 
new  forms  of  insurance,  based,  possibly,  on  erroneous  principles — 
actuarial,  financial  or  otherwise — so  that  the  prestige  of  the  busi- 
ness may  be  enhanced  and  that  the  chances  of  unintentional 
error  or  deliberate  fraud  may  be  reduced  to  a  minimum.  Also  the 
question  of  Federal  supervision  of  insurance. 

Fourth:  The  most  effective  coordination  of  life  and  other 
forms  of  insurance  to  public  health  activities,  including  all  forms 
of  social  betterment  aiming  directly  or  indirectly  towards  an  in- 


478  WORLD'S  INSURANCE  CONGRESS 

crease  in  longevity  and  a  reduction  in  the  death  rate  from  pre- 
ventable diseases. 

Fifth:  The  problem  of  social  insurance  should  be  frankly  dis- 
cussed from  the  point  of  view  of  private  enterprise  as  related 
to  the  nation-wide  interest  in  questions  which  are  receiving  an 
increasing  amount  of  attention,  best  illustrated  in  the  forthcom- 
ing International  Congress  on  Social  Insurance,  to  be  held  in  this 
country  in  1915.  It  is  important  that  the  institutions  serving 
social  insurance  purposes  in  this  country  at  the  present  time  shall 
have  the  facts  of  their  experience  properly  presented  for  public 
consideration,  and  that  the  enormous  benefit  resulting  therefrom 
shall  not  be  obscured  by  purely  theoretical  conditions  of  compul- 
sory insurance  methods  abroad. 

Sixth:  The  more  effective  and  practical  teaching  of  insurance 
as  a  science  in  universities,  commercial  high  schools,  etc.,  and  the 
most  suitable  methods  of  including  the  elementary  facts  and  prin- 
ciples of  insurance  in  all  its  branches  in  the  study  of  business 
methods,  commercial  arithmetic,  commercial  law,  etc. 

Seventh:  Finally,  the  Congress  could  consider  the  practicabil- 
ity of  establishing  a  National  institute  for  insurance  science,  in 
which  all  branches  of  insurance  should  be  presented  for  the  infor- 
mation and  instruction  of  the  public  as  an  aid  towards  a  better 
understanding  of  the  elementary  facts  of  insurance  experience 
and  a  guide  in  the  framing  of  wise  legislation  for  the  supervision 
and  control  of  a  business  which,  in  recent  years,  has  assumed  very 
large  proportions.  Such  an  institute,  as  implied  in  the  foregoing 
suggestion,  should  also  include  an  insurance  museum  for  the  col- 
lection and  preservation  of  insurance  literature,  insurance  expe- 
rience, and  the  documentary  methods  and  means  by  which  the 
business  has  been  carried  on  in  the  past,  and  is  being  carried  on 
at  the  present  time.  This  plan  would  tend  measurably  to  ad- 
vance the  dignity  of  insurance  as  a  social  institution,  and  make 
manifest  in  the  most  convenient  form  the  services  rendered  by 
sound  insurance  in  all  its  bi-anches  to  governmental,  associated 
or  individual  efforts  to  make  the  world  a  better  place  to  live  in  by 
eliminating  the  risks  of  the  individual  life.  Such  an  institute 
would  also  serve  as  a  means  of  welding  together  all  of  the  numer- 
ous and  at  present  widely  separated  insurance  interests  into  one 
vast  National  and  even  international  organization  for  the  devel- 
opment and  conservation  of  insurance  as  a  science  and  an  art 
making  effectively  and  progressively  for  human  betterment. 
Along  the  line  of  the  foregoing  suggestions,  the  World's  Con- 
■  gress  on  Insurance  can,  I  believe,  be  made  the  most  memorable 
event  in  the  moderin  history  of  insurance,  and  the  results  of  the 
vast  gathering  to  be  held  can  be  made  to  promote  the  good  of  the 
business  and  the  good  of  the  people. 


WORLD'S  INSURANCE  CONGRESS  479 


THE  WORLD'S  INSURANCE  CONGRESS 

By  Charles  Warren  Pickell 
Manager,  Massachusetts  Mutual  Life  Insurance  Co.,  Detroit,  Mich. 

The  World — A  big  proposition  geographically — a  bigger  o;ie  fi- 
nancially— a  tremendous  problem  socially  and  morally — great  ques- 
tions, great  needs,  great  opportunities. 

Insurance — A  guaranteed  indemnity  against  loss. 

Congress — A  fourfold  meaning: 

1.  An  assemhly — a  coming  together  in  one  place — a  convention. 

2.  A  convergence — a  concurrence  or  concentration — a  tendency 
towards  one  idea. 

3.  A  conference — an  oral  demonstration  or  intercourse — the  act 
of  consulting  formally. 

4.  A  council — a  court  of  appeal — board  of  control — an  advisory 
capacity. 

Some  definition!  But  definitions  are  only  vehicles  to  carry  us 
along.  Some  event!  Ah,  that's  it,  scwie  evewf.'  Think  of  it!  Hear 
the  tramp  of  feet — thousands  gathering  from  the  four  corners  of 
the  earth  at  the  "Golden  Gate"  actuated  by  one  purpose — to  con- 
sult with  one  another — and  devise  means  how  people  of  all  nations 
can  conserve  property  and  life  by  indemnifying  them  against  loss. 

Here  is  a  conception  both  happy  and  praiseworthy.  Out  of  the 
travail  of  men's  souls — or  I  might  better  say  a  man's  soul — Mr. 
W.  L.  Hathaway — was  born  this  movement  which  will  do  more 
to  shape  future  transactions  in  insurance  circles  than  any  other 
single  event  in  the  history  of  the  business. 

"Chance  and  change  are  busy  ever."  The  sea  takes  its  toll; 
fire  turns  to  ashes  the  finest  architectural  dreams ;  disease  ravishes 
the  sturdiest  of  men;  casualty  lays  its  tragedies  on  humanity's 
stage;  and  other  economic  impairments  demand  thought  and  ac- 
tion. What  is  the  puiT)0se  of  this  Congress?  Why,  when,  ivhere, 
how,  must  be  answered.  It  will  be  an  Inquisition  and  a  College. 
A  new  era  has  dawned.  Men  are  awake  to  the  needs.  The  call 
is  for  brains  and  brawn.  Back  of  this  movement  are  the  genius 
and  energies  of  thousands  of  America's  most  progressive  citizens, 
who  furnish  the  dynamics  to  commerce,  the  impulse  to  thousands 
of  worthy  enterprises  and  the  refining  fire  to  society.  To  appre- 
ciate thoroughly  the  stupendous  significance  of  this  Congress  one 
must  take  a  comprehensive  view  of  the  enormous  interests  Insur- 
ance has  protected.  Billions  of  dollars — sums  so  large  they  over- 
whelm one !  Nearly  everything  can  be  covered.  Branches  of  this 
great  business  permeate  every  walk  in  life.  It  means  making 
good,  redemption,  conservation,  of  all  interests,  and  so  touches  all 
men  every w^here.  Some  of  the  great  corporations  have  even  be- 
come World  powers  in  finance. 


480  WORLD'S  INSURANCE  CONGRESS 

Because  of  the  far-reaching  influences  of  this  wonderful  business, 
the  interest  in  this  Congress  should  be  universal.  Not  alone  will 
officers,  directoi-s,  and  field  men  of  the  many  corporations  engaged 
directly  in  the  various  line  of  insurance  be  interested,  but  thou- 
sands of  allied  interests  will  see  possibilities  of  immeasurable 
good  and  lend  a  hand  to  insure  a  greater  destiny. 

But  what  of  our  own  branch?  What  benefit  will  likely  obtain 
to  life  insurance,  which  is  now  conceded  by  every  one  to  be  the 
greatest  factor  in  social,  economic  and  righteous  existence  in  the 
whole  wide  world?  Easy!  Given:  earnest  men  with  ideas  and 
visions;  a  common  interest  touching  heart  as  well  as  purse;  a 
praiseworthy  ambition  for  growth  and  fruit;  and  get  them  to- 
gether. Something  doing?  Well,  yes!  Threshing,  sifting,  clean- 
ing, measuring  wheat!  Digging,  crusing,  separating,  melting 
gold!  Listen,  concretely:  (a)  a  clear-cut  and  well  arranged  cur- 
riculum of  common  school  and  university  courses  of  education  for 
the  special  training  of  the  public  conscience;  (h)  the  consecration 
of  health  and  the  treatment  of  disease,  prolonging  life  and  reduc- 
ing the  cost  of  protection;  (c)  the  devising  and  suggesting  of 
better  and  more  uniform  State  legislation,  reducing  taxes,  safe- 
guarding investments,  preventing  abuses  that  have  crept  into  field 
work;  (d)  the  encouragement  of  permanent  local  and  national  as- 
sociational  work  calculated  to  effect  a  higher  standard  of  business 
in  office  and  field;  (e)  the  endorsement  of  the  great  insurance 
press  which  has  done  so  much  for  the  business  during  the  past 
thirty  years — with  a  hint  or  two;  (/)  the  inauguration  of  a  com- 
prehensive and  systematic  plan  of  publicity  through  the  secular 
press — and  many  others. 

But  greater  than  all  these  splendid  results  from  this  World's 
Insurance  Congress  will  be  the  dignifying  of  the  business  we  love 
before  the  eyes  of  the  world.  Already  in  the  hearts  of  thousands 
engaged  in  life  underwriting  it  is  affectionately  enshrined.  Edu- 
cational work  is  going  on.  Publicity — the  citizen's  schoolmaster 
— is  attaching  great  value  to  items  of  news  not  only  for  informa- 
tion but  for  training.  One  cannot  read  the  weekly  records  of 
settlements  of  death  claims  without  having  his  heart  burn  within 
him.  Other  items  quicken  the  pulse  and  excite  the  admiration  of 
the  great  common  people.  And  when  the  important  questions 
briefly  touched  upon  above  are  considered,  conclusions  reached 
and  the  public  advised,  how  resplendent  will  be  the  effect !  Like  a 
great  incandescent  light  of  millions  of  candle  power,  its  effulgence 
will  illume  the  whole  world. 

So!  Let  every  life  underwriter  everywhere  read  about  this 
Congress,  talk  about  this  Congress,  and  work  for  this  Congress 
until  the  bell  rings  the  curtain  down  on  the  last  act.  Interest  is 
what  we  want — earnestness  is  what  we  want — enthusiasm  is  what 
we  want!  Plan  to  attend  the  sessions.  Offer  suggestions  at  any 
and  all  times.  The  community  of  our  interests  should  stir  every 
solicitor,  every  manager,  every  official  to  the  very  depths  of  his 


WORLD'S  INSURANCE  CONGRESS       481 

being,  and  find  its  expression  in  the  heartiest  endorsement  of  this 
movement.  Let  it  be  said  that  the  exponents  of  life  underwriting 
— than  which  there  is  no  greater  branch  of  insurance — are  not 
derelict  or  dilatory  in  discharging  their  duty  to  make  this  gath- 
ering both  inspiring  and  fruitful.  Sound  the  tocsin ;  let  the  clans 
gather;  arm  yourselves  to  fight  ignorance,  bigotry  and  indifference 
to  the  last  ditch.  We  shall  write  history.  We  shall  touch  the 
springs  of  action  in  human  hearts.  And  as  the  years  hasten  on 
space  w^e  shall  know  that  we  have  done  our  share  to  make  our 
business  better,  nobler,  purer,  greater. 


POLICYHOLDERS  BURDENED  BY  TAXES  * 

By  Edward  A.  Woods 
Vice  President,   The  National  Association  of  Life  Underwriters 

Perhaps  one  effect  of  this  world-wide  insurance  Congress  will 
be  to  bring  home  to  the  people  at  large  what  insurance  really  is — 
that  it  is  not  primarily  or  principally,  and  in  life  insurance  per- 
haps least  of  any  form,  a  private  institution  for  private  gain.  It 
is  really  a  gigantic,  public  service,  public  welfare  institution.  In- 
surance of  all  kinds  is  merely  an  organization  for  distributing  a 
loss  by  common  contributions  of  all. 

One  of  the  effects  of  the  gigantic  growth  of  corporations  is  that 
they  are  composed  of  so  many  people,  many  things  that  concern 
each  are  not  considered  as  affecting  the  individual  members.  Such, 
for  example,  is  the  question  of  taxation  of  insurance  policyholders. 
If  every  one  in  the  United  States  who  remitted  a  premium  for 
life  insurance  sent  $2  to  some  tax  collector  on  each  $100  of  pre- 
miums, there  would  be  such  an  outcry  about  the  taxation  of  life  in- 
surance as  could  not  be  withstood  by  our  taxing  authorities.  Yet, 
as  a  matter  of  fact,  more  than  this  does  go  for  taxes  throughout 
the  United  States  for  each  $100  of  premiums  paid. 

With  the  growth  of  this  gigantic  institution,  the  individual 
seems  so  infinitesimal  a  part  of  the  whole  and  he  seems  so  remote 
from  the  organization  that  his  being  affected  is  forgotten.  If  a 
tax  w^ere  imposed  on  a  partnership  of  two  persons,  of  course  both 
would  know  it  and  they  would  present  every  argument  they  could 
think  of,  if  the  tax  was  unfair,  why  it  should  not  be  levied.  Sim- 
ilarly, if  a  small  corporation  were  taxed  so  that  every  stockholder 
and  officer  could  be  communicated  with  and  knew  just  how  it 
affected  his  profits,  they  would  resist  it  strenuousl3^  But  when  it 
comes  to  taxing  a  railroad  company,  the  steel  corporation,  or  a 
body  of  life  insurance  policyholders,  the  difficulty  is  to  make  each 
policyholder  understand  that  it  affects  him  directly  just  as  much 

*  An  article  prepared  for  distribution  by  the  Commission  in  charge  of  the 
World's  Insurance  Congress  Events. 


482  WORLD'S  INSURANCE  CONGRESS 

as  if  the  organization  consisted  of  three  or  four  members  instead 
of  as  many  hundred  thousand. 

Unfortunately,  years  ago  life  insurance  companies  were  not 
always  conducted  in  a  way  that  showed  they  were  being  managed 
for  the  policyholders'  interests.  Further,  the  taxation  question 
was  handled  by  the  "Black  Horse  Cavalry"  method  and  did  not 
educate  the  policyholder  to  understand  that  he  was  affected.  This 
must  be  overcome  and  lived  down.  The  days  of  fighting  taxation 
in  this  way  will  never  return,  and  every  real  friend  of  insurance 
is  glad  they  will  not.  But  in  the  absence  of  these  wrong  methods, 
the  enlightened  opinion  of  policyholders  must  be  aroused  to  the 
fact  that  they  are  the  insurance  company;  that  they  own  the  se- 
curities, including  railroad  bonds,  and  all  the  assets  of  the  com- 
pany ;  that  any  increased  expense,  any  loss,  any  tax  imposed  upon 
the  insurance  company  comes  right  out  of  their  pockets.  It  is  safe 
to  say  that  all  officers  of  life  insurance  companies  realize  now, 
perhaps  more  than  at  any  other  time,  that  the  governments  of  our 
various  States,  and  even  of  the  Nation,  will  insist  that  insurance 
companies  are  public  service  institutions  and  must  be  run  for  the 
benefit  of  policyholders,  who  must  be  primarily  considered.  But 
the  policyholder  also  must  be  made  to  feel  this;  and  the  more  he 
considers  the  far-reaching  effect  of  life  insurance  as  an  institution 
in  equalizing  losses,  in  promoting  thrift,  in  averting  dependency, 
in  combating  disease,  in  adding  stability  to  the  entire  fabric  of 
society,  the  more  will  he  be  interested  in  everything  that  adversely 
affects  him  and  the  more  possible  will  it  be  to  reduce  taxation  to  a 
reasonable  amount  and  at  least  place  America  on  the  basis  of 
foreign  countries ;  for  it  cannot  be  too  often  repeated  that  America 
is  the  only  country  of  the  world  that  so  taxes  life  insurance.  While 
it  is  favored  by  every  other  nation,  even  nations  noted  for  heavy 
taxation,  America  is  the  one  country  that  imposes  an  enormous 
tax  upon  gross  premiums  paid  by  policyholders  in  almost  every 
State. 

Further,  when  policyholders  of  old  line  companies  understand 
that  fraternal  organizations  and  assessment  companies  are  not 
taxed — which  is  as  it  should  be — they  will  resent  scientific  old  line 
life  insurance  being  picked  upon  for  such  a  taxation  burden  as 
$13,000,000  a  year.  Fraternal  orders  resist  and  successfully  re- 
sist taxation  because  each  member  knows  that  it  affects  him  and 
he  is  "on  the  job"  at  once  if  any  tax  measure  is  proposed  and  it 
is  readily  defeated.  When  the  25,000,000  policyholders  of  regular 
companies  understand  the  same  thing,  it  will  be  just  as  difficult — 
if  not  more  so,  because  of  their  large  numbers — to  have  legisla- 
tion passed  in  their  various  States  adversely  affecting  tliem. 

A  congress  bringing  insurance  as  an  institution  prominently 
before  the  people  of  the  United  States  will  further  this  apprecia- 
tion of  what  life  insurance  is — not  a  private  enterprise  conducted 
for  profit,  but  the  most  gigantic  public  service  institution  in  the 
world,  comprising  more  people  in  its  benefits  than  all  other  finan- 


WORLD'S  INSURANCE  CONGRESS  483 

cial  interests  put  together  for  the  protection  of  the  home,  for  pro- 
vision for  old  age,  for  the  reduction  of  dependents,  and  for  the 
stability,  prosperity  and  peace  of  all  society. 


EXCESSIVE    WASTE    OF    HUMAN   LIFE* 

By  E.  E.  Rittenhouse 
President,  The  Life  Extension  Institute,  Inc. 

How  many  people  realize  the  extent  of  the  loss  of  money  and  of 
human  life  in  this  country  from  preventable  diseases? 

The  officials  of  the  World 's  Insurance  Congress  and  the  Panama- 
Pacific  International  Exposition  have  performed  a  real  public 
service  by  including  in  their  program  a  plan  for  the  public  dis"- 
cussion  of  this  vital  problem — the  conservation  of  health  and  life. 

The  American  people — especially  those  of  San  Francisco — are 
quite  familiar  with  the  meaning  of  the  word  "fire-waste,"  but 
they  are  not  so  conscious  of  the  significance  of  the  word  "life- 
waste." 

The  annual  loss  in  the  United  States,  due  to  fire-waste,  has  been 
estimated  at  250  million  dollars.  This  is  a  vast  sum,  but  the 
annual  economic  loss  from  preventable  deaths  is  placed  at  1,500 
million,  or  six  times  greater  than  the  fire  loss.  This  is  a  very 
conservative  estimate;  the  actual  financial  loss  from  preventable 
deaths  is  doubtless  much  higher  than  this. 

It  is  true  that  the  American  people  are  gradually  becoming 
aroused  to  the  need  of  checking  the  needless  destruction  of  life  as 
well  as  of  property,  but  they  still  place  the  value  of  property  far 
above  that  of  human  life.  For  instance :  our  municipalities  spend 
approximately  $1.65  per  capita  to  prevent  fire  loss,  and  but  33 
cents  per  capita  in  public  health  service. 

During  the  past  ten  years,  over  six  million  people  have  died 
in  the  United  States  from  preventable  diseases.  Over  27,000  of 
this  number  died  in  San  Francisco.  Of  the  conservative  Fisher 
basis  of  estimate,  these  deaths  have  caused  San  Francisco  a  loss 
of  nearly  sixty-five  million  dollars  during  the  past  ten  years. 

But  this  is  a  trifling  matter  compared  to  the  human  misery,  in 
the  form  of  physical  suffering,  sorrow,  poverty,  immorality  and 
crime,  which  have  resulted  from  this  needless  sickness  and  these 
premature  deaths. 

Why  should  the  life  insurance  companies  be  interested  in  this 
subject?  The  answer  is:  First — because  these  companies  have 
over  25  million  policyholders  carrying  over  20  billion  dollars  of 
insurance,  which  is  more  than  six  times  the  circulating  medium  of 
the  country.     This  is  more  life  insurance  than  is  carried  by  all 

*  This  is  one  of  a  series  of  articles  that  -were  written  by  various  men  for 
distribution  by  this  Commission. 


484  WORLD'S  INSURANCE  CONGRESS 

the  rest  of  the  people  in  the  world  combined.  The  American 
showing  such  extraordinary  confidence  in  the  institution  and  in 
the  management  of  life  insurance,  it  follows  that  the  managements 
of  these  companies  have  a  certain  amount  of  influence  over  these 
people,  and  that  this  power  should  be  used  in  every  legitimate  way 
to  promote  the  welfare  of  these  people  and  of  the  public  generally. 

During  the  years  the  life  insurance  companies  have  given  the 
great  nation-wide  movement  for  the  conservation  of  life  their  moral 
support,  they  have  now  nearly  all  come  to  recognize  that  a  life 
conservation  campaign  among  policyholders  is  a  proper  function 
for  life  insurance  companies,  and  six  or  eight  of  them  have  made 
appropriations  to  carry  on  this  work. 

While  there  is  an  altruistic  side  of  this  work,  it  is  purely  a 
business  matter  with  the  life  insurance  companies.  At  least  30 
per  cent  of  the  deaths  among  policyholders  are  from  preventable 
or  postponable  diseases,  and  yet  the  savings  from  the  funds  pro- 
vided for  mortality  (on  the  net  amount  of  risk)  in  100  of  the 
more  important  companies  during  the  year  1913  was  over  44  mil- 
lion dollars. 

Virtually  all  of  this  money  goes  into  the  surplus  from  which 
dividends  are  returned  to  policyholders,  and  it  therefore  operates 
to  reduce  the  cost  of  life  insurance.  If  it  is  worth  while  to  save 
this  much  for  the  policyholders  from  the  funds  set  aside  for  annual 
mortality,  it  is  worth  while  to  save  more,  and  it  is  obvious  that 
more  can  be  saved  by  a  reduction  in  the  death  rate  from  these 
preventable  diseases  among  policyholders. 

The  life  insurance  companies  who  engage  in  this  life-saving 
program  are  not  only  reducing  the  cost  of  life  insurance  to  their 
patrons  and  increasing  the  comfort  and  happiness  of  thousands  of 
people  who  are  thus  saved  from  sickness  and  premature  death, 
but  they  are  rendering  a  great  service  to  the  people  at  large. 

The  influence  of  their  health  educational  work  extends  to  the 
general  public  and  assists  in  stimulating  interest,  not  only  of  the 
individual  in  the  care  of  his  health,  but  of  the  general  public  in 
the  support  of  the  public  health  service.  The  life,  accident  and 
health  insurance  companies  are  now  performing  a  most  valuable 
public  service,  and  it  is  to  their  interest  as  well  as  to  that  of  the 
people  generally  that  they  should  use  every  atom  of  their  power 
and  influence  to  spread  knowledge  of  healthful  living  and  of  the 
science  of  disease  prevention  generally. 

The  World's  Insurance  Congress  will  give  these  companies  a 
chance  to  contribute  to  the  public  understanding  of  this  subject, 
and  to  demonstrate  to  the  public  that  they  are  keenly  alive  to 
their  duties  and  responsibilities  in  enlarging  their  service  to  hu- 
manity whenever  opportunity  offers. 


WORLD'S  INSURANCE  CONGRESS  485 


TPIE    SOCIAL   PROGRAM    OF   PRESENT   DAY   LIFE 
INSURANCE  * 

As  Displayed  by  the  Welfare  Exhibit 

OF  THE  Metropolitan  Life  Insurance  Company 

AT  THE  Panama-Pacific  International  Exposition 

Insurance  has  undergone  a  significant  change  in  recent  years  to 
which  the  World 's  Insurance  Congress  of  1915  should  give  definite 
form  and  expression.  In  whatever  field  of  insurance,  whether 
fire,  casualty,  or  life,  it  is  becoming  clear  that  the  function  of 
insurance  is  a  larger  one  than  originally  conceived.  It  is  not  its 
purpose  merely  to  minimize  burdens  by  distributing  losses,  but  also 
to  prevent  the  losses  which  insurance  is  created  to  compensate. 

In  fire  insurance  this  policy  has  resulted  in  campaigns  for  fire 
prevention  through  the  development  of  sprinkler  systems,  fire  pa- 
trols and  building  inspection,  the  training  of  fire  departments  in 
greater  efficiency  and  in  other  activities  which  have  greatly  re- 
duced fire  losses.  In  casualty  insurance  the  same  thought  has 
brought  about  important  developments  in  factory  supervision,  cre- 
ating the  ' '  Safety  First ' '  movement  and  perfecting  the  new  science 
of  safety  engineering  which  is  cutting  down  disabling  accidents 
to  a  remarkable  degree.  Finally,  in  life  insurance,  we  are  more 
and  more  realizing  that  the  companies  must  attempt  to  prolong 
life  as  well  as  to  pay  claims.  In  the  association  of  policyholders 
of  all  kinds  there  is  a  tremendous  force  arising  from  the  very 
fact  of  association  of  large  numbers  which  can  and  should  be 
utilized  for  the  greatest  public  good. 

The  World's  Insurance  Congress  can  do  no  greater  service  than 
to  crystallize  and  popularize  this  idea  of  conservation  as  the  key- 
note and  corollary  to  insurance.  European  countries  have  long 
appreciated  this,  but  have  applied  their  efforts  mainly  to  the  safe- 
guarding of  property  and,  to  a  less  degree,  through  the  agency 
of  their  social  insurance  institutions,  to  the  control  of  accidents 
and  disease.  In  America,  on  the  other  hand,  the  interest  of  in- 
surance executives  has  been  aroused  especially  to  the  possibilities 
of  saving  human  life  through  the  inauguration  of  visiting  nursing, 
periodical  medical  examinations  of  policyholders,  campaigns  of 
health  education  and  like  activities.  In  this  respect,  American 
companies  have  laid  splendid  foundations  and  are  cutting  out  for 
themselves  most  promising  lines  of  future  accomplishment. 

We,  in  America,  can  therefore  teach  as  well  as  learn  by  con- 
sulting with  our  European  confreres  in  the  matter  of  life  and 
property''  conservation.  Advances  in  insurance  are  likely  to  follow 
fast  in  the  train  of  the  World's  Insurance  Congress.    Workmen's 

*  Issued  under  the  auspices  of  the  Commission  in  charge  of  the  World's 
Insurance  Congress  Events. 


486  WORLD'S  INSURANCE  CONGRESS 

compensation  insurance  to  cover  industrial  accidents  has  developed 
in  the  United  States  in  less  than  five  years.  The  next  few  years 
may  very  well  bring  with  them  extensions  into  other  forms  of 
workmen's  insurance  to  cover  sickness,  old  age,  and  involuntary 
unemployment.  Ordinary  business  foresight,  if  no  more,  will  dic- 
tate the  need  for  a  careful  examination  by  American  underwriters 
of  the  experience  of  the  European  systems,  whether  State  or  pri- 
vate in  nature,  with  a  view  to  gauging  the  field  for  similar  enter- 
prise in  America.  It  is  the  special  virtue  of  these  forms  of  social 
insurance  that  they  lend  themselves  admirably  to  beneficent  poli- 
cies of  accident  prevention  and  the  reduction  of  sickness,  disa- 
bility and  premature  death. 

The  IMetropolitan  Life  Insurance  Company  has  felt  that  its  own 
contribution  to  the  World's  Insurance  Congress  and  to  the  Pan- 
ama-Pacific International  Exposition  connected  therewith  would 
be  most  useful  if  limited  to  an  exhibit  of  what  it  has  accomplished 
along  the  lines  of  life  conservation  work,  considering  that  it  has 
carried  its  program  to  a  point  probably  beyond  that  of  any 
other  organization  in  America.  The  exhibit  of  the  Company, 
therefore,  emphasizes  especially  the  welfare  work  which  it  has 
developed  for  its  policyholders.  The  exhibit  also  includes  the 
program  of  welfare  work  for  employees.  It  is  hoped  that  this 
will  serve  as  an  example  and  encouragement  to  other  employers 
of  labor  and  help  at  once  to  connect  a  worthy  social  effort  favor- 
ably with  the  insurance  business. 

The  exhibit  is  placed  to  advantage  in  the  Palace  of  Mines,  where 
it  occupies  about  2,000  square  feet  of  floor  space.  The  booth 
to  house  the  exhibit  has  been  planned  by  a  skilful  architect,  and 
will  attract  attention  through  the  artistic  use  of  light,  color  and 
form.  The  Metropolitan  towers  are  the  keynote  of  the  exterior 
design,  and  help  to  support  a  roof  of  cathedral  glass. 

In  the  interior  the  back  and  side  walls  are  covered  with  eigh- 
teen illustrated  charts  and  fifty  colored  transparencies,  which  de- 
scribe in  detail  the  various  phases  of  the  Company's  welfare  work. 
The  charts,  three  by  five  feet  each,  are  prepared  in  poster  form  in 
three  colors.  One  section  describes  the  Visiting  Nurse  Service, 
the  Health  and  Happiness  League,  the  publications  on  health 
topics,  and  the  other  health  and  social  activities  which  the  Com- 
pany has  inaugurated  for  its  policyholders.  Another  section  de- 
scribes the  Company's  welfare  work  for  employees.  These  charts 
include  the  luncheon  service  for  employees  in  the  home  office, 
educational  activities,  tuberculosis  sanatorium  at  Mt.  IMcGregor, 
New  York,  the  staff  savings  fund,  and  other  features. 

The  transparencies  are  large  colored  photographs  on  glass,  and 
are  the  best  of  a  notable  collection  of  pictures  received  at  the  home 
office.  They  illustrate  different  phases  of  the  Company's  welfare 
work.  These  transparencies  form  a  cornice  immediately  above 
the  charts  on  the  three  walls  and  add  much  to  the  attractiveness 
of  the  exhibit. 


WORLD'S  INSURANCE  CONGRESS       487 

A  number  of  interesting  models  are  placed  in  the  booth.  One 
in  the  form  of  a  relief  map  shows  the  location  of  the  Company's 
eighteen  hundred  nursing  centers  in  the  towns  and  cities  of  the 
United  States  and  Canada.  These  have  been  popularly  called 
"Metropolitan  Life-saving  Stations."  An  exact  reproduction  of 
the  Company's  sanatorium  at  ]\It.  IMcGregor,  New  York,  for  the 
use  of  its  tubercular  employees  is  displayed.  This  model  depicts 
in  detail  the  many  buildings  that  dot  the  415  acre  tract  in  the 
Adirondack  foothills. 

Two  large  floor  cabinets  present  graphic  charts  giving  the  statis- 
tics of  the  Company's  nursing  service  and  mortality  experience. 
One  series  of  charts  points  out  especially  the  principal  causes  of 
death  of  the  Company's  policyholders;  another  shows  the  death 
rates  of  persons  engaged  in  certain  hazardous  occupations.  The 
Company  hopes  through  this  means  to  arouse  a  sound  public  opin- 
ion in  favor  of  safeguarding  workers  in  certain  occupations,  in 
order  to  reduce  preventable  accidents,  diseases  and  deaths. 

A  large  rest  room  has  been  reserved  for  visitors  at  one  end  of 
the  exhibit.  This  room  has  been  tastefully  decorated  and  comfort- 
ably furnished.  Writing  desks  and  stationery  afford  facilities  for 
writing  letters,  and  other  conveniences  will  be  offered  to  visitors. 

Qualified  representatives  of  the  Company,  including  one  of  its 
nursing  staff,  are  present  at  all  times  to  answer  questions  on  the 
welfare  work  of  the  Company  and  to  distribute  the  Company's 
extensive  and  helpful  literature  on  personal  and  civic  hygiene. 

AMERICA'S  PRESSING  MORTALITY  PROBLEM* 

By  E.  E.  Rittenhouse 

Chairman,    Health    Conservation    Committee,    World's   Insurance 

Congress 

There  are  now  approximately  410,000  deaths  annually  in  the 
United  States  from  organic  diseases  of  the  kidneys  and  urinary 
system  and  of  the  heart  and  circulatory  system. 

I  feel  I  am  safe  in  saying  that  80  per  cent  of  these  deaths  could 
be  postponed  indefinitely  if  we  would  teach  these  people  personal 
hygiene — how  to  guard  against  these  aflSictions,  and  to  encourage 
periodic  health  examinations. 

Statistics  show  the  alarming  increase  of  41  per  cent  in  20  years 
in  organic  mortality  in  the  United  States.  In  Europe,  on  the 
other  hand,  organic  mortality  shows  a  downward  tendency. 

Can  we  afford  to  ignore  these  facts  any  longer?     It  means  a 

decline  in  the  power  of  resistance  of  the  American  people.     It  is, 

moreover,  due  to  causes  local  to  our  own  country,  as  European 

countries  show  no  such  trend. 

*  This  is  one  of  a  series  of  articles  which  -were  -u'ritten  by  various  men  of 
the  United  States  for   distribution  by  this  Commission. 


488  WORLD'S  INSURANCE  CONGRESS 

Various  ideas  are  advanced  as  the  cause  of  this  condition,  such 
as  alcohol,  tobacco,  drugs,  diseases  of  vice,  and  the  "melting  pot" 
process,  by  which  is  meant  the  assimilation  of  the  foreign  element 
into  our  working  class. 

Another  alleged  cause  is  excessive  life  strain,  due  to  changed 
modes  of  living  brought  about  by  increased  comforts  and  lux- 
uries. Our  people  show  a  marked  decline  in  physical  activity, 
caused  no  doubt  by  the  greater  number  of  occupations  of  a  seden- 
tary nature.  It  is  a  deplorable  fact  that  Americans  are  always 
searching  for  physical  ease — hence  the  popularity  of  the  chair,  the 
trolley  and  the  elevator. 

Logical  as  these  various  alleged  causes  may  seem,  I  think  the 
real  cause  is  a  lack  of  adjustment  to  these  changed  modes  of  living. 
The  diet  of  the  average  business  man  is  not  compatible  with  the 
physical  exertion  he  undergoes  in  the  pursuit  of  his  daily  routine 
of  work. 

What,  then,  is  the  solution  of  this  situation?  First— I  would 
suggest,  healthful  living.  By  this,  I  mean  a  regulation  of  diet  to 
conform  with  the  amount  of  exercise  our  average  business  man 
takes.  Hand  in  hand  with  healthful  living  comes  individual  hy- 
giene. Every  one  should  be  taught  the  care  of  the  body  and  its 
organs.  The  public  should  learn  how  to  guard  against  needless 
sickness  and  premature  death.  I  cannot  urge  too  strongly  the  ad- 
visability of  periodic  health  examinations,  for  often  if  the  pres- 
ence of  trouble  be  detected,  it  can  be  checked  or  eradicated  before 
it  gets  beyond  control. 

Here  it  seems  reasonable  to  expect  the  State  to  aid.  It  has  al- 
ready taught  public  sanitation  so  effectively  that  death  from  com- 
municable diseases  has  decreased  nearly  50  per  cent  in  30  years. 
If  the  State  considers  it  worth  while  to  save  a  life  from  the  ravages 
of  smallpox  or  tuberculosis,  why  should  it  not  also  fight  organic 
disease  1 

The  World's  Insurance  Congress  is  an  unportant  factor  in  as- 
sisting in  this  fight  against  organic  mortality  in  that  it  will  aid 
in  promulgating  information  to  the  public  in  regard  to  the  rules 
for  correct  living. 


POSSIBILITIES    OF    THE    WORLD'S    INSURANCE    CON- 

GRESr    J  AN -^MA-PACIFIC    INTERNATIONAL 

EXPOSITION 

By  W.  S.  Diggs 
President,  The  Insurance  Federation  of  Ohio 

Having  a  vital  interest  in  the  Federation  movement,  wliieh  has 
for  its  purpose   the   fraternizing  and   welding  of  insurance  mow 


WORLD'S  INSURANCE  CONGRESS  489 

and  insurance  interests  of  every  class  and  kind,  including  the  as- 
sured, into  a  great  cooperative  body,  I  naturally  am  very  deeply 
interested  in  the  international  movement  known  as  "The  World's 
Insurance  Congress.'" 

A  world-wide  movement  of  this  character  can  fittingly  center  all 
of  its  activities  in  the  great  commercial  metropolis  of  the  west,  San 
Francisco,  so  recently  rebuilt  by  insurance  funds,  sent  in  from  all 
over  the  world,  to  the  amount  of  over  two  hundred  millions  of 
dollars.  In  fact,  there  has  been  no  more  forceful  and  convincing 
demonstration  of  the  soundness  of  insurance  underwriting  than 
the  San  Francisco  conflagration.  It  is  incumbent  upon  the  insur- 
ance men  of  the  whole  country  to  make  the  World's  Insurance 
Congress  in  every  way  worthy  of  the  event  it  celebrates — the 
greatest  known  engineering  and  industrial  achievement — the  com- 
pletion of  the  Panama  Canal. 

Necessarily,  the  forming  of  this  Congress  is  and  will  continue 
to  be  a  constructive  movement  of  international  importance,  a  great 
forward  step,  broadening  and  extending  our  vision  in  insurance 
affairs.  All  of  the  events  incident  to  the  World's  Insurance  Con- 
gress will  have  a  vitalizing  and  toning  influence,  to  the  end  that 
a  larger  development,  a  better  understanding  and  a  closer  bond 
of  sympathy  may  exist  between  the  men  composing  the  army  of 
benefactors  engaged  in  providing  protection  to  life  and  property 
through  a  system  known  as  "Insurance  Underwriting." 

There  are  a  number  of  things  of  vital  importance  to  the  insuring 
public,  as  well  as  to  the  insurance  fraternity,  which,  if  unchecked, 
will  prove  a  far-reaching  menace. 

I  refer,  first,  to  the  growing  tendency,  on  the  part  of  the  State 
and  Nation,  to  burden  the  different  branches  of  insurance  with 
excessive  fees  and  taxes,  including  the  taxing  of  life  insurance 
reserves. 

State  rate-making,  through  the  enactment  of  law,  instead  of  by 
actual  experience  and  merit  rating,  is  deeply  deplored.  A  notable 
example  is  in  the  fire  insurance  business,  which  has  been  such  a 
signal  failure  in  both  States  of  Missouri  and  Kentucky. 

The  tendency  toward  paternalism,  with  insurance  as  its  first  ex- 
periment, has  assumed  surprising  proportions  in  different  sections 
of  the  country.  State  insurance,  both  competitive  and  monopo- 
listic, now  in  operation  in  several  States,  is  its  legitimate  and 
shameful  offspring. 

The  Treasury  Department  of  the  Federal  Government  at  Wash- 
ington is  insisting  on  the  passage  of  the  Byrnes  and  Moon  Bills, 
the  first  with  a  view  to  establishing  a  Fidelity  division  for  the 
bonding  of  Federal  employees  in  the  Treasury  Department,  and 
the  second  to  create  a  guarantee  fund  for  the  bonding  of  postal 
and  other  employees. 

Finally — the  all  important  question,  in  view  of  the  foregoing,  is 
upon  us:  Shall  the  States  and  the  Government  at  Washington 
compete  with  their  own  citizens,  whom  they  tax  for  support,  in 


490  WORLD'S  INSURANCE  CONGRESS 

the  opportunities  for  a  livelihood  offered  for  the  insurance  busi- 
ness? 

I  believe  the  larger  questions,  some  of  which  are  enumerated 
above,  and  the  more  serious  problems  confronting  and,  in  some 
cases,  even  threatening  the  whole  structure  of  underwriting,  can 
only  be  solved  and  for  good,  through  intelligent  unity  of  action, 
forming  a  solid  front  and  taking  a  fearless  stand  along  the  firing 
line  like  men  of  courage  and  conviction.  Shall  we  stand  supinely 
by  and  see  our  business  demoralized,  and  eventually  destroyed? 
Such  a  defensive  movement  should  embrace  every  insurance  activ- 
ity, with  no  diverse  opinions  on  the  main  issues.  The  consequent 
oneness  of  thought  and  general  cooperation  would  spread  the 
gospel  of  sound  underwriting,  of  honest  protection  honestly  sold, 
throughout  the  civilized  world,  including  every  city,  town  and 
hamlet,  reaching  to  a  very  large  degree,  the  army  of  insurers. 
A  new  song  of  confidence  and  security  would  come  from  the  lips 
of  the  insurance  man  in  the  knowledge  that  his  chosen  profession 
will  not  be  invaded  by  the  well-meaning  but  misguided  law  mak- 
ers, that  insurance  will  no  longer  be  a  political  football  and  the 
stepping-stone  for  the  self-seeking  politician. 

The  World's  Insurance  Congress  should  also  furnish  the  oppor- 
tunity for  launching  a  campaign  in  the  interest  of  uniform  laws 
affecting  every  line  of  insurance.  There  is  an  enormous  annual 
waste  of  money  and  effort  which  could  be  remedied  in  this  way. 

Last  year  nearly  twenty  millions  of  dollars  were  collected  by 
the  insurance  departments  of  the  various  States,  whereas  it  took 
much  less  than  two  millions  to  support  all  of  those  departments. 
In  other  words,  more  than  eighteen  millions  were  collected  in  ex- 
cess of  the  need  and  purpose  for  which  the  fund  was  created.  The 
fruits  of  this  form  of  legalized  robbery  increase  annually.  Is  it 
not  time  to  call  a  halt  on  this  outrageous  system? 

The  experience  of  the  writer  in  organization  work  has  been 
limited  very  largely  to  Ohio  and  neighboring  States ;  therefore,  the 
question  of  National,  or  Federal  supervision  has  not  been  an  issue 
in  the  Federation  movement.  However,  I  have  some  personal  con- 
victions on  the  subject,  especially  in  view  of  the  decision  of  the 
United  States  Supreme  Court  in  the  Kansas  case.  It  would  seem 
that  National  or  Federal  supervision,  if  you  please,  whether 
through  the  medium  of  an  amendment  to  the  Federal  Constitution 
or  otherwise,  is  the  only  avenue  for  relief.  It  would  eliminate  the 
present  undesirable  and  unwieldy  system  of  each  of  the  forty-eight 
States,  and  a  like  number  of  insurance  commissioners,  becoming 
a  regulating  and  rate-making  power  with  such  poorly  directed 
supervision  as  naturally  grows  out  of  a  limited  knowledge  of  the 
business.  Fire  insurance  companies  have  been  somewhat  indiffer- 
ent on  the  subject  and  will  probably  be  the  last  to  lend  the  move- 
ment their  general  support.  It  is  to  be  expected  also  that  the 
various  States  will  not  willingly  abandon  their  right  to  tax  and 
regulate  the  business  of  insurance. 


WORLD'S  INSURANCE  CONGRESS  491 

All  of  the  big  questions  affecting  underwriting  are  applicable 
in  the  main  to  every  kind  of  insurance,  and  are  national  in  impor- 
tance and  scope.  The  United  States  has  one  strong  centralized 
Government,  made  up  of  forty-eight  component  parts  called  States. 
As  our  country  has  grown,  as  our  Government  has  developed,  and 
as  our  industrial  fabric  is  growing,  the  business  of  underwriting 
has  also  gi'own  and  developed  until,  with  leaps  and  bounds,  it  has 
spread  throughout  all  civilization  with  the  result  that  we  now 
spend  nearly  two  billion  annually  for  insurance  protection.  In 
financial  importance,  the  business  of  insurance  underwriting  is 
second  only  to  the  great  railway  systems  of  the  country.  In  every 
other  respect,  it  is  first.  Insurance  is  co-extensive  with  progress, 
thrift  and  civilization.  It  was  a  small  business  a  century  or  even 
a  half  century  ago,  but  it  is  a  great  and  mighty  business  to-day, 
indescribably  so  in  its  importance  and  scope. 

Not  only  is  our  form  of  Government  on  the  centralized,  cooper- 
ative plan,  but  the  best  interests  of  our  business  demand  that 
we,  too,  operate  on  the  same  successful  basis.  The  great  develop- 
ment of  the  country,  through  the  inventive  genius  of  its  citizen- 
ship, has  eliminated  both  time  and  space,  so  to  speak,  and  this  has 
had  a  centralizing  and  consolidating  influence.  It  has  fixed  a 
great  unit  of  activity  and  power  for  all  commercial  life.  The  Na- 
tion has  become  the  unit  in  importance  as  against  the  State,  and 
second  to  the  Nation  is  the  municipality. 

Uniform  laws  for  the  control  and  regulation  of  all  interstate 
transactions  may,  upon  first  thought,  seem  like  a  dream.  In  con- 
sidering it,  however,  we  concede  at  once  that  with  forty-eight  dif- 
ferent States,  with  as  many  different  forms  of  laws  and  State  reg- 
ulation, with  the  individual  ideals  and  conflicting  opinions  of  four 
dozen  different  insurance  commissioners,  although  in  most  in- 
stances, honest  and  often  efficient,  with  the  outrageous  burden  of 
taxation,  amounting  to  extortion,  the  indescribable  duplication  of 
effort  and  machinery,  both  by  the  State  and  the  companies,  form 
a  crazy-quilt,  a  miserable  piece  of  patchwork,  expensive  and  in- 
efficient. It  is  wholly  unsatisfactory  to  all  students  of  insurance 
conditions  and  a  sad  commentary  on  an  otherwise  wonderful  his- 
tory of  a  great  business. 

Insurance,  therefore,  is  not  only  interstate  in  its  operation  and 
importance,  but  international,  as  shown  by  the  fact  that  about 
sixty  millions  of  the  money  paid  to  rebuild  San  Francisco  came 
from  foreign  companies.  To  me  it  seems  inevitable  that  any  sat- 
isfactory and  effective  regulation  of  our  business  concerns,  includ- 
ing insurance,  having  interstate  or  both  interstate  and  interna- 
tional dealings,  must  ultimately  come  through  uniform  laws.  This 
will  not  come  in  a  day  or  through  a  single  effort ;  it  will  require  a 
spirit  of  cooperation  that  will  excite  the  admiration,  approval  and 
support  of  the  army  of  insurance  buyers.  You  may  call  it  Na- 
tional supervision  or  Federal  control,  if  you  like — '*A  rose  by 
any  other  name  would  smell  as  sweet." 


492       WORLD'S  INSURANCE  CONGRESS 

The  dauntless  courage  of  Mr.  Darwin  P.  Kingsley,  President  of 
the  New  York  Life  Insurance  Company,  his  fearless  and  forceful 
advocacy  of  Federal  control,  can  but  arouse  the  admiration  of 
all  well  informed  men,  whether  they  agree  with  him  or  not.  The 
World's  Insurance  Congress  will  no  doubt  give  this  weighty  sub- 
ject full  consideration. 

A  Publicity  Bureau,  national  in  its  character,  representing 
every  branch  of  insurance  activity,  should  be  one  of  the  natural 
outgrowths  of  the  World's  Insurance  Congress.  We  need  to  have 
the  inspiring  facts  concerning  the  business  of  insurance  constantly 
before  the  public.  No  newspaper  should  come  from  the  press  with- 
out some  good,  wholesome  insurance  news  for  its  readers.  At  the 
beginning  of  each  day  throughout  all  the  land  the  glad  tidings 
of  good  insurance  and  what  it  means  to  the  home  and  to  business, 
should  reach  the  entire  public  through  the  medium  of  the  morn- 
ing press.  It  would  correct  the  incorrect  and  damaging  news,  and 
in  removing  the  cause,  when  it  exists,  for  just  criticism.  No  false 
or  damaging  .statement  need  go  unchallenged,  and  as  a  result, 
few  such  statements  would  appear  in  print.  Publicity  w^ould  be 
the  strongest  medium  we  could  employ  in  support  of  National  uni- 
form laws  and  final  Federal  supervision. 

A  paper  of  this  character  would  be  wholly  incomplete  without 
expressing  enthusiastic  appreciation  of  the  fire  prevention  move- 
ment. We  believe  that  the  great  work  already  accomplished  and 
under  way  all  over  the  country  will  be  greatly  augmented  by  the 
Congress.  Every  effort,  requirement,  apparatus,  device  and  equip- 
ment, improving  the  hazard  and  lessening  the  enormous  fire  waste 
no  doubt  will  receive  the  emphatic  stamp  of  approval  of  the 
World's  Insurance  Congress. 

Since  insurance  has  become  the  basis  of  all  material  progress  and 
prosperity,  it  is  important  that  the  business  should  know  exactly 
how  to  conduct  itself,  how  it  can  permanently  expand,  develop 
and  grow,  without  the  burden  of  over-taxation  and  the  constant 
danger  of  prosecution  for  law  violations.  Insurance  should  be 
anchored,  as  steadfast  as  the  veiy  hills,  through  sane  and  uniform 
National  laws  and  regulation. 

In  a  way,  underwriting  is  floundering  and  groping  around  the 
best  it  can,  subject  as  it  has  been  to  the  personal  judgment  and 
often  to  ''strong  armed"  methods  of  single  individuals.  State 
officers  with  onlj^  temporary  authorit}^,  who  have  probably  secured 
political  preferment  by  using  our  business  as  an  issue  in  their 
campaigns  for  election. 

The  (juestion  is  thus  raised,  and  confronts  all  wide-awake  insur- 
ance men:  Shall  insurance  continue  to  be  legitimate  prey  for 
the  uninformed  who  may  happen  to  be  in  power?  The  brain  and 
brawn  of  our  business  must  come  to  the  front,  supported  by  the 
combined  insurance  influence  of  the  country,  and  courageously 
meet  and  solve  the  important  problems  affecting  underwriting, 
through  uniform  National  laws  and  supervision.     In  this  way,  we 


WOBLD'S  INSUEANCE  CONGRESS       493 

can  call  a  halt  and  demand  justice,  yes,  see  to  it  that  our  business 
be  given  a  "square  deal"  and  removed  from  State  politics,  as  well 
as  divorced  from  the  State  and  ward  politician.  I  believe  we  could 
accomplish  what  now  seems  impossible,  dispose  of  one  great  menace 
to  our  business,  the  rebater.  That  alone  would  almost  justify  the 
existence  of  the  Congress.  The  already  live  issue  of  agency  quali- 
fications, and  the  preservations  of  the  great  agency  system,  seem- 
ingly threatened,  could  be  M'orked  out  on  a  safe  and  permanent 
basis. 

That  the  powerful  and  far-reaching  insurance  interests  of  the 
countiy  need  regulation,  there  can  be  no  question.  The  Govern- 
ment only  can  administer  just  and  effective  control  and  supervi- 
sion of  their  extensive  operations.     Insurance  will  welcome  it. 

Inspired  by  the  success  of  the  World's  Insurance  Congress,  in- 
teresting, as  it  will,  every  branch  of  insurance  and  its  allied  inter- 
ests in  a  larger  view  of  underwriting,  the  things  heretofore  consid- 
ered in  this  paper  as  highly  desirable  can  be  brought  about  through 
organization  and  cooperation.  One  of  the  dangers,  however,  to  our 
business  at  this  time  is  a  tendency  toward  over-organization.  If 
the  smaller  cities,  towns  and  rural  districts  are  to  be  interested 
in  a  nation-wide  movement,  it  must  be  through  one  great  powerful 
organization  with  branches  in  every  State  and  important  county, 
as  the  expense  of  many  organizations  is  too  great  for  the  average 
agent  and  the  confusion  growing  out  of  it  is  inevitable  and  far- 
reaching,  indeed  almost  unbelievable,  yet  well  known  to  those  en- 
gaged in  organization  work. 

Americans  have  a  genius  for  organization  which  is  the  spirit  of 
progi'ess  and  the  World's  Insurance  Congress  will  teach  and  dem- 
onstrate its  incalculable  value.  It  is  organization,  however,  vi- 
talized by  the  amalgamation  of  efforts  and  by  the  most  sympathetic 
cooperation,  which  is  powerful  and  significant  in  the  business 
world.  Competition  may  have  been  the  life  of  trade  at  one  time, 
but  it  is  no  longer  so.  This  is  the  day  of  sane,  loyal  cooperation. 
Our  future  does  not  lie  behind  us.  Let  us  abandon  the  defensive 
attitude  and  adopt  the  constructive  course. 

The  fixed  proportions  and  ratios  outlined  by  the  skilled  archi- 
tect must  be  honored  by  the  builder  if  he  would  succeed.  In 
music  the  individual  notes  are  worse  than  meaningless  if  not  com- 
bined in  accordance  with  the  rules  of  harmony  into  a  melodious 
theme.  So  we  may  say,  that  by  standing  alone,  the  individual 
is  weakened  and  that  the  organization  made  up  of  such  men  is  a 
useless  thing,  a  meaningless  discord  unless  the  individual  efforts 
be  combined  through  cooperation  into  a  harmonious  whole.  Such 
earnest  cooperation  is  undeniably  the  potent  advance  agent  of  suc- 
cess. The  lack  of  it  among  insurance  men  to  a  large  degree,  demor- 
alizes and  dissipates.  Unorganized  we  go  about  like  "a  rope  of 
sand,"  breaking  here  and  there,  making  our  efforts  futile. 

We  may  organize  until  doomsday  on  the  most  acceptable  and 
approved  plan,  but  if  we  do  not  cooperate  the  organization  amounts 


494  WORLD'S  INSURANCE  CONGRESS 

to  nothing.  A  business  may  be  launched  with  abundant  capital, 
manned  by  the  ablest  and  most  skilled  officers  and  directors,  with 
general  conditions  the  very  best,  and  yet  without  cooperation, 
strong  and  enthusiastic,  the  business  would  be  either  a  failure  or 
a  sad,  indifferent  success.  This  is  an  age  of  cooperation,  it  is  the 
law  of  life  and  growth,  and  men  and  institutions  cease  to  thrive 
without  it. 

The  strength  of  unity  is  indisputable,  whereas  nothing  can  do 
more  to  retard  the  progress  of  a  business  or  to  write  failure  into 
the  history  of  a  movement  than  lack  of  organization  and  cooper- 
ation. 

The  reasons  for  lack  of  cooperation  are  twofold ;  one  is  that  men 
are  often  too  limited  in  their  vision  to  agree  on  what  is  best  to 
be  done.  They  miss  the  "main  Chance"  while  quibbling  over 
small  differences.  The  other  is  that  selfish  motives  deceive  men 
who  are  self-centered  into  thinking  they  can  succeed  better  alone. 
Some  men  really  enjoy  the  delusion.  A  dispassionate,  frank  ex- 
change of  views  and  ideas  will  correct  the  first.  The  recognition 
that  the  great  common  good  of  all  is  the  real  good  of  an  indi- 
vidual, and  that  it  is  far  greater  than  any  good  he  can  hope  to 
obtain  for  himself,  will  overcome  the  second.  We  cannot  brush 
aside  the  inexorable  law  of  inter-dependence.  It  has  become  fun- 
damental in  all  business  life.  He,  who  lives  for  and  to  himself 
bars  progress  out,  shuts  out  the  world  and  shuts  himself  in. 

Let  us  reach  out  and  catch  the  vision  of  true  success,  and  the 
willingness  to  take  the  steps  which  will  lead  to  it,  even  to  the 
extent  of  self-effacement,  which  is  not  always  pleasant  to  contem- 
plate. Temporary  success  should  be  set  aside  for  permanent 
growth.  Why  totter  alone  almost  "to  the  fall"  when  we  can  mar- 
shal our  separate  forces  for  the  great  strength  and  power  growing 
out  of  real  cooperation  and  soar  with  the  strength  of  the  eagle? 
In  so  doing  the  rich  reward  of  success  will  be  inevitable. 

Cooperation  in  its  final  analysis  binds  men  into  a  fraternity  for 
service,  which  always  makes  for  success  of  the  highest  type  and 
quality,  and  for  length  and  strength  of  days. 

The  idea  of  a  great  National  brotherhood,  including  every  factor 
and  form  of  underwriting,  welded  into  a  vast  organization,  should 
be  an  accomplished  fact.  This  to  me  is  no  idle  dream  and  should 
be  one  of  the  inevitable  results  of  the  World 's  Insurance  Congress. 

The  great  business  of  insurance  underwriting,  wherever  trans- 
acted, in  this  and  other  lands,  will  see  the  dawn  of  a  new  day  in 
the  World 's  Insurance  Congress. 


WORLD'S  INSURANCE  CONGRESS  495 

SAFETY    FIRST    MOVEMENT    OF    THE    WORLD'S 
INSURANCE  CONGRESS* 

By  C.  H.  Boyer 

Manager,  Casualty  Department,  National  Life  Insurance  Co. 
of  the  United  States  of  America 

I  desire  to  give  strong  endorsement  to  the  World's  Insurance 
Congress.  I  do  not  recall  anything  in  the  history  of  insurance 
and  publicity  of  greater  importance  than  the  establishment, 
through  the  initiative  of  Commissioner  Hathaway,  of  this  Con- 
gress, with  all  its  splendid  possibilities. 

A  matter  of  supreme  importance  at  the  present  time  is  the  move- 
ment for  accident  prevention.  The  "Safety  First"  idea  has  had 
wonderful  growth  of  late,  and  is  impressing  itself  upon  men's 
minds  everywhere.  There  is  a  marked  difference  between  pre- 
venting a  calamity  and  paying  indemnity.  In  years  past,  acci- 
dents, sickness,  death,  fire  and  other  disasters  were  too  often  re- 
garded as  acts  of  Providence,  to  be  borne  with  Christian  forti- 
tude, but  not  to  be  guarded  against  by  systematic  efforts.  Every 
man  lived  more  within  his  own  circle,  answerable  to  himself  and 
not  so  much  to  society,  subject  to  individual  rather  than  society 
hazard.  The  danger  of  public  calamity  was  not  so  great,  and  sys- 
tematic plans  to  avert  it  were  rare. 

With  increasing  complexity  of  social  and  community  life,  with 
multiplicity  of  machines  for  manufacturing  and  means  of  rapid 
transportation,  with  the  development  of  electrical  science,  with  the 
invention  of  new  types  of  engines,  and  all  the  other  conditions  aris- 
ing from  our  modern  life,  there  has  gradually  come  a  realization 
that,  the  community  must  protect  its  members  against  increasing 
dangers.  The  old  rule  of  the  road  when  every  may  drove  his  own 
team  through  country  lanes  or  city  streets  was  simply  that  each 
should  turn  his  team  to  the  right  or  left  and  give  half  the  road 
to  a  passing  vehicle.  So  the  workman  in  a  shop  was  simply  sup- 
posed to  take  care  of  his  little  machine  or  his  little  corner  of  the 
workroom,  and  avoid  accidents  to  himself  from  any  careless  act 
of  his  own. 

Now,  however,  with  the  immense  traffic  of  our  city  streets  and 
the  vast  number  and  variety  of  vehicles  in  use,  it  has  become  nec- 
essary to  enact  strict  traffic  ordinances  and  keep  traffic  directors 
on  crowded  corners,  with  the  single  duty  of  enforcing  rules  and 
preventing  accidents.  So  in  the  factory,  with  its  many  compli- 
cated engines  and  machines  and  its  electrical  contrivances,  it  has 
been  found  necessary  to  formulate  and  enforce  the  strictest  rules 
for   the  safety  of  each  operator  and  his   fellow- workmen.     The 

*  An  article  prepared  for  distribution  by  the  Commission  in  cliarge  of  the 
World's  Insurance  Congress  Events. 


496  WORLD'S  INSURANCE  CONGRESS 

same  care  resulting  from  increasing  complexity,  is  shown  in  rules 
quarantining  diseases  and  ordinances  governing  the  class  of  build- 
ings to  be  erected  in  restricted  districts. 

It  is  unfortunate  but  nevertheless  true,  that  much  of  this  neces- 
sity for  extraordinary  care  has  been  taught  us  by  calamity.  It 
is  questionable  whether  many  great  movements  in  this  direction 
would  have  been  made  if  they  had  not  been  compelled  by  acci- 
dents. Even  workmen  would  have  continued  careless  and  without 
due  regard  for  the  safety  of  their  fellows,  but  for  these  calami- 
ties; and  it  is  certain  that  manufacturers  would  not  have  added 
preventive  methods  to  their  heavy  expense  account  if  accidents 
and  resultant  damages  had  not  shown  the  necessity  for  it. 

I  think  a  great  deal  of  this  carelessness  in  the  public  attitude 
toward  prevention  of  calamity  has  been  due  to  the  ease  with  which 
the  damages  can  be  escaped  by  the  individual.  It  has  been  so 
easy  for  indemnity  against  disasters  to  be  purchased  from  legal 
practitioners  or  insurance  companies  or  other  sources,  that  the 
heads  of  great  enterprises  have  felt  inclined  rather  to  purchase 
such  indemnity  than  to  prevent  the  calamities  themselves.  The 
public  mind  has  been  confused  as  to  the  real  issues,  especially  as 
they  affect  insurance  companies.  Instead  of  regarding  an  acci- 
dent or  a  fire  or  even  a  death  as  a  total  loss,  people  have  looked 
upon  the  insurance  payment  as  meeting  the  financial  loss  instead 
of  distributing  it. 

So  long  as  this  view  prevailed  it  was  easy  for  men  to  neglect 
giving  proper  heed  to  prevention.  Safety  devices  were  regarded 
as  too  expensive,  and  many  manufacturers  and  transportation 
companies  deliberately  took  the  chance  of  damages  and  accidents 
in  preference  to  expending  money  for  prevention.  As  calamities 
increased,  there  was  a  change  of  attitude;  and  now  the  manufac- 
turers are  seeking  safety  devices  and  are  willing  to  pay  their  cost 
for  humanitarian  and  material  reasons. 

The  insurance  companies  have  been  a  little  slow  in  entering 
into  this  prevention  movement,  probably  because  of  a  timidity  or 
a  fear  of  public  misunderstanding.  I  would  not  wish  to  assume 
for  a  moment  that  the  companies  are  opposed  to  the  "Safety 
First"  idea.  I  think  they  have  mistrusted  public  opinion  and 
have  been  in  doubt  as  well  regarding  their  responsibility. 

Of  recent  years,  however,  the  companies  have  grown  into  the 
belief  that  it  is  not  only  proper  but  advisable  for  them  to  take 
an  active  interest  in  the  movement.  While  purely  selfish  reasons 
may  be,  and  doubtless  are,  imputed  to  them,  they  know  that  the 
broad  benefits  of  their  work  will  become  apparent,  and  a  philan- 
thropic as  well  as  a  selfish  motive  will  justly  be  attributed.  ITcnce 
they  have  overcome  the  old  timidity  and  are  among  the  most  active 
in  the  propaganda.  Out  of  this  have  arisen  the  movements  of  in- 
dividual companies  and  associations  of  companies  for  fire  preven- 
tion, life  extension,  health  conservation,  and  accident  prevention. 

It  seems  strange  that  at  this  late  date  and  in  view  of  the  wide 


WORLD'S  INSURANCE  CONGRESS       497 

spread  interest  taken  in  their  splendid  movements,  a  purely  selfish 
motive  should  be  imputed  to  the  insurance  companies  for  their 
participation.  It  seems  strange  that  the  people,  in  whose  interest 
this  movement  really  is,  should  in  any  way  antagonize  or  discour- 
age it  simply  because  they  think  the  companies  receive  a  direct 
benefit.  It  seems  absurd  that  any  man  should  object  to  following 
rules  for  prolonging  his  own  life,  because  he  may  have  to  pay  a 
few  more  premiums  to  the  life  insurance  company  before  his  bene- 
ficiary receives  the  death  benefit;  or  that  a  man  should  be  care- 
less of  his  own  property,  because  on  account  of  this  care  he  will 
avoid  a  fire  and  fail  to  collect  indemnity;  or  that  he  should  ob- 
ject to  safe-guarding  himself  from  accident  or  disease,  because 
the  health  and  accident  company  will  have  premium  payments 
increased  and  indemnity  payments  reduced.  The  broad  principle 
of  the  value  of  life  and  time  and  health  should  prevail  here,  and 
not  be  obscured  by  the  smaller  considerations. 

Then  again  it  will  naturally  follow,  as  adjustment  of  premium 
paj^ments  to  loss  payments  continues,  that  the  rates  of  premiums 
will  be  reduced  by  the  very  care  exercised.  And  this  benefit  will 
accrue  to  the  insured  rather  than  to  the  stockholders  of  the  com- 
panies. Hence  the  financial  objection  which  is  sometimes  raised 
even  at  this  late  date  is  stripped  of  all  force  when  the  facts  in 
the  case  are  properly  presented  to  the  public. 

I  think  one  of  the  greatest  opportunities  of  he  World's  Insur- 
ance Congress  is  in  this  direction.  The  millions  who  will  view 
the  various  exhibits  of  the  Panama-Pacific  International  Expo- 
sition will  be  attracted  by  many  strikingly  graphic  displays  of 
safety  devices.  Not  only  the  interest  of  the  mechanic  but  a  large 
human  interest  will  attract  the  public  to  such  an  exhibit.  It 
seems  to  me  that  the  various  casualty  companies  should  find  this 
a  splendid  and  profiable  means  of  bringing  these  matters  promi- 
nently to  public  attention.  They  would  thus  accomplish  a  double 
purpose,  disabusing  the  public  mind  of  prejudices  and  justifying 
the  movement  toward  accident  prevention  no  matter  by  whom 
inaugurated  or  encouraged,  and  giving  wide  publicity  to  it. 

Nor  should  they  feel  in  the  least  degree  modest  because  of  the 
advantage  that  companies  may  get  from  the  movement.  The  pub- 
lic after  all  receives  the  whole  benefit.  Since  the  insurance  com- 
pany of  whatsoever  kind  is  to  all  intents  and  purposes  mutual, 
in  the  fact  that  it  collects  and  distributes  indemnity  funds,  any 
reduction  in  the  amount  of  indemnity  must  mean  a  corresponding 
reduction  in  collections.  The  agencies  of  collection  and  distri- 
bution are  therefore  justified  by  the  public  interest  in  using  every 
means  to  prevent  calamity  and  reduce  indemnity. 

Accidents  of  occupation  and  travel  show  no  signs  of  diminu- 
tion. From  reports  of  the  Interstate  Commerce  Commission  it 
appears  that  nearly  12,000  persons  are  killed  and  more  than 
200,000  persons  injured  every  year  on  the  railroads  of  the  United 
States.    It  is  impossible  to  compute  the  money  value  of  these  lives 


498  WORLD'S  INSURANCE  CONGRESS 

and  of  the  lost  time  involved,  Avhile  the  lives  themselves  are  price- 
less. Yet  in  the  midst  of  these  appalling  calamities,  certain  rail- 
roads are  able  to  show  that  through  the  operation  of  safety  de- 
vices they  have  avoided  fatal  and  non-fatal  accidents  during  long 
periods.  The  late  E.  H.  Harriman  offered  a  prize  to  the  railroad 
making  the  best  showing  in  this  regard ;  and  it  is  noteworth}^  that 
the  Southern  Pacific  Railway,  which  has  won  this  prize,  shows  a 
record  absolutely  clear  of  accidents  involving  human  life  and 
limb.  It  required  large  expenditure  for  block  signal  systems  and 
other  safety  appliances  to  accomplish  this  result.  Yet  no  one 
would  doubt  for  a  moment  that  the  result  more  than  justified  the 
outlay.  Hence  the  example  set  by  this  and  other  railroads,  if 
properlj'  displayed  through  the  World's  Insurance  Congress,  will 
doubtless  be  followed  by  others. 

So  with  safety  appliances  employed  by  manufacturing  establish- 
ments. Every  line  of  manufacture  has  its  peculiar  hazards  and 
its  own  method  of  lessening  them.  Many  factories  are  installing 
these  devices.  If  through  the  medium  of  the  Congress  and  of 
the  insurance  companies  a  full  display  of  all  such  devices  can 
be  had,  it  will  serve  as  the  strongest  possible  object-lesson  to  man- 
ufacturers who  have  not  yet  adopted  them. 

The  companies  could  in  this  connection  illustrate  by  actual  fig- 
ures the  reduction  made  on  liability  and  other  premiums  for  such 
appliances.  This  would  add  to  the  human  reason  for  such  con- 
trivances a  strong  financial  reason. 

If  by  this  display  a  considerable  number  of  large  manufacturers 
and  transportation  systems  can  be  induced  to  make  installation 
of  accident-preventing  devices,  the  Congress  will  have  more  than 
justified  its  formation  in  this  one  item  alone.  The  discussion  of 
such  matters  is  one  thing,  graphic  object-lessons  quite  another. 
The  end  to  be  sought  is  the  convincing  of  all  interested  that 
safety  devices  are  necessary. 

Just  how  these  exhibits  can  be  secured  and  collected  I  am  not 
prepared  to  say.  The  element  of  competition  may  perhaps  be  used, 
and  it  is  possible  that  the  offering  of  medals  or  other  premiums 
would  be  an  excellent  means  to  secure  a  display.  But  it  occurs 
to  me  that  here  can  be  no  question  as  to  the  desirability  of  the 
benefits  that  will  follow  from  it.  Therefore,  in  their  own  behalf 
and  in  behalf  of  the  public  they  serve,  the  insurance  companies 
are  not  only  justified  but  under  obligation  to  assist  some  such 
movement  in  some  practical  way.  If  the  toll  of  human  life  and 
human  time  now  taken  through  preventable  accidents  is  to  be  de- 
creased, now  is  the  accepted  time  and  the  casualty  companies  are 
the  proper  medium  for  bringing  about  this  much  desired  result. 
No  better  time  or  opportunity  will  ever  occur  than  that  offered 
by  the  World's  Insurance  Congress. 

There  are  two  organizations  which  I  think  can  well  interest 
themselves  in  this  work,  the  National  Safety  Council  and  tlie  Na- 
tional Board  of  Fire  UnderAvriters.     The  first  has  already  done 


WORLD'S  INSURANCE  CONGRESS  499 

splendid  work  in  direction  of  practical  suggestions  for  saving  life 
and  property  from  destruction  by  accident.  Just  recently  the 
second  has  placed  its  excellent  laboratories  at  the  disposal  of  those 
interested  in  this  movement.  Tlie  opportunity  thus  given  to  test 
and  prove  the  efficiency  of  safety  devices  marks  a  very  great  for- 
ward step  in  the  accident  prevention  movement.  It  also  provides 
a  means  of  standardizing  these  various  devices  which  will  be  of 
great  assistance  in  the  active  preparation  of  exhibits  displayed  in 
connection  with  the  World's  Insurance  Congress. 

With  the  activity  of  the  National  Safety  Council  in  accident 
prevention  and  the  various  industrial  corporations  and  accident 
insurance  companies  in  originating  devices,  the  efficiency  of  the 
National  Board  Laboratories  in  testing  them,  and  the  universal 
publicity  given  to  these  devices  and  their  value  through  the 
World's  Insurance  Congress,  there  appears  no  reason  why  in- 
dustrial safety  should  not  be  made  a  great  feature  of  the  Con- 
gress, adding  materially  to  its  value,  and  giving  strong  impetus 
to  the  "Safety  First"  movement. 


OUR  FIRE  WASTE  A  NATIONAL  DISGRACE  * 

By  Sam  F.  Woolard 

Chairman,  Fire  Waste  Committee  of  the  Trans-Mississippi  Com- 
mercial  Congress;   Member  of  the   Fire  Prevention 
Committee  of  the  World's  Insurance  Congress 

The  meaning  of  the  World 's  Insurance  Congress  should  be  plain 
to  all,  yet,  to  sum  it  up  in  a  few  words,  its  object  is  a  general 
consultation  and  an  exchange  of  ideas  on  subjects  in  which  all 
branches  of  insurance  are  alike  interested. 

My  belief  is  that  the  one  subject  of  most  importance  to  all  in- 
surance people,  and  of  most  vital  interest  to  the  general  public, 
is  conservation  along  the  lines  of  Fire  Prevention  and  Fire  Pro- 
tection, Accident  Prevention  and  Health  Conservation. 

"Safety  First"  must  be  the  watchword  of  the  people  of  the 
world  if  they  would  lessen  the  loss  of  human  life,  the  depletion  of 
our  National  wealth  and  of  our  energies  and  the  undermining  of 
our  endurance,  all  of  which  are  on  the  increase  from  a  great  num- 
ber of  causes  brought  on  by  lack  of  education,  and  a  carelessness 
and  indifference  to  the  rights  of  others. 

Much  splendid  work  is  being  done  along  these  lines.  The  medi- 
cal profession  is  earnestly  seeking  to  know  the  "cause"  of  the 
disease  and  its  preventives.  In  fact,  millions  of  dollars  are  being 
spent  along  this  line  of  scientifie  investigation  the  world  over.    All 

*  An  article  prepared  for  distribution  by  the  Commission  in  charge  of  the 
World's  Insurance  Congress  Events. 


500  WORLD'S  INSURANCE  CONGRESS 

governments  through  their  greatest  minds  are   seeking  the  best 
metliods  to  conserve  the  natural  resources  of  the  country. 

The  writer's  direct  interest  is  in  the  conservation  of  life  and 
property  from  the  ravages  of  the  fire  fiend.  The  expression  is  still 
trite  that  "an  ounce  of  prevention  is  equal  to  a  pound  of  cure." 
"Safety  First" — all  insurance  branches  should  be  deeply  inter- 
ested in  fire  prevention — the  life  companies  on  account  of  the 
great  loss  of  life  in  fires,  reaching  thousands  annually,  the  accident 
companies  on  account  of  the  tens  of  thousands  annually  injured 
by  fire,  the  fire  insurance  companies  on  account  of  the  millions  of 
dollars  paid  in  losses  annually  on  account  of  fire,  the  general 
public  on  account  of  the  enormous  drain  it  is  making  on  the 
world's  reserve,  both  in  men  and  money. 

We  are  all  aware  of  the  fact  that  there  are  two  causes  of  fires 
which  destroy  property.  One  is  strictly  the  act  of  Providence, 
hence  unavoidable  by  man  in  so  far  as  the  origin  is  concerned, 
yet  it  is  within  his  power  to  keep  the  losses  within  the  minimum 
by  adopting  all  means  of  fire  protection  in  the  way  of  proper 
construction  and  providing  the  best  fire  fighting  facilities. 

The  second  cause  is  produced  by  man's  act,  either  intentional  or 
unintentional,  and  many  authorities  believe  that  ninety  per  cent 
of  fires  can  be  prevented.  We  will  all  agree  that  preventable  fires 
are  a  crime  because  the  courts  of  our  land  say  that  the  destruction 
of  life  and  property  constitutes  a  crime.  The  act  of  destroying 
property  or  taking  life  has  the  same  effect  upon  the  property  or 
upon  the  victim  whether  premeditated  or  accidental.  We  should 
be  held  responsible  in  either  case,  and  in  many  countries  the  man 
or  w^oman  who  through  carelessness  or  premeditation  is  found 
guilty  is  in  some  way  punished.  To  emphasize  this  statement, 
in  other  words  to  give  you  proof  as  to  the  laws  of  some  foreign 
countries  and  the  way  they  are  enforced,  I  beg  to  quote  an  in- 
teresting account  of  a  fire  in  Germany,  and  the  rigid  inquiry 
into  the  cause  and  the  penalty  imposed  on  those  who  violated 
the  laws  for  the  safeguarding  against  fire: 

"An  American  gentleman,  living  with  his  family  in  Berlin, 
was  one  morning  awakened  by  the  smell  of  smoke  in  his  apartment, 
and  found  that  a  fire,  originating  in  a  room  overhead,  was  eating 
its  way  down  through  the  ceiling  of  his  dining-room.  The  fire 
was  extinguished  with  a  chemical  apparatus  without  any  water 
damage  and  without  needless  destruction  of  walls  and  furniture, 
and  before  the  firemen  left  they  had  removed  every  trace  of  debris 
and  scrubbed  the  floor  in  the  room  in  which  they  had  worked. 

"Meanwhile  a  careful  investigation  was  made  by  officers 
equipped  with  note  books,  not  by  asking  questions  of  tenants  or 
gossiping  with  servants,  but  from  personal  observation.  Next 
morning  tlie  gentleman  who  had  turned  in  the  alarm  was  sent  for 
and  conducted  before  a  fire  marshal,  or  equivalent  officer  with 
inquisitorial  powers.  That  he  had  important  engagements  else- 
where counted  for  nothing.     Public  business  never  waits  on  pri- 


WORLD'S  INSURANCE  CONGRESS  501 

vate  convenience  in  Prussia.  He  was  asked  all  sorts  of  questions 
which  he  was  able  to  answer  satisfactorily.  The  fire  was  known 
to  have  originated  from  a  hot  lump  of  coal  which  had  dropped 
from  a  laundry  stove  in  the  attic  and  rolled  upon  an  unprotected 
wooden  floor.  The  tenant  showed  that  the  stove  was  an  appoint- 
ment of  the  building,  provided  by  the  landlord,  and  that  it  was 
neither  his  duty  nor  his  privilege  to  change  it. 

' '  Then  the  landlord  was  called.  He  showed  that  he  had  recently 
purchased  the  building,  under  the  usual  guaranty  that  all  laws 
and  ordinances  had  been  complied  with  in  construction  and  ap- 
pointments; that  he  had  neither  set  nor  moved  the  stove  in  ques- 
tion, and  that  his  attention  had  not  been  called  to  any  condition 
involving  fire  risk.  This  was  not  considered  quite  satisfactory  and 
he  was  told  to  await  further  instructions.  Then  the  builder  from 
whom  the  landlord  purchased  was  called.  He  had  to  admit  that 
he,  as  builder,  was  responsible  for  the  setting  of  the  stove  as  the 
police  had  found  it,  and  that  he  had  violated  the  law  in  neglecting 
to  provide  a  suitable  metallic  hearth,  of  the  required  kind  and  di- 
mensions, between  it  and  the  floor.  For  this  he  was  held  cul- 
pable. 

"The  assessment  against  him  began  -with  the  estimated  cost  to 
the  city  of  responding  to  the  alarm  and  extinguishing  the  fire,  in- 
cluding the  damage  to  the  furniture  and  property  of  tenants,  and 
was  rounded  by  an  exemplary  fine  of  500  marks  as  a  reminder  that 
laws  are  enacted  for  a  purpose,  and  carry  substantial  penalties 
for  their  violation.  The  damage  to  the  building  was  not  included 
in  the  assessment  against  the  builder.  It  was  held  that  while  the 
owner  had  not  committed  the  violation  of  law  which  caused  the 
fire,  he  had  been  negligent  in  not  discovering  and  correcting  it,  and 
for  this  reason  he  should  pay  for  his  own  repairs  and  stand  charged 
with  a  knowledge  of  his  duty  in  like  cases." 

Instead  of  making  a  hero  of  the  man  who  has  a  fire  caused  from 
carelessness  on  his  part  and  passing  the  hat  for  his  benefit,  let 
the  proper  punishment  follow  and  we  will  soon  awaken  to  our 
manly  duty  toward  public  welfare. 

Whether  a  fire  is  caused  by  directly  and  intentionally  applying 
the  match  or  by  poor  building  construction  or  the  careless  han- 
dling of  explosives  or  the  use  of  other  than  a  safety  match,  we  are 
responsible  to  the  general  public,  and  it  should  be  considered  a 
moral  responsibility  even  if  not  amenable  to  law.  Yet  it  is  to  be 
hoped  that  our  laws  will  cover  such  cases  before  the  end  of  many 
years.  The  careless  leaving  of  a  lamp  where  it  could  be  kicked 
over  by  a  cow  is  the  accredited  cause  of  the  great  Chicago  Fire. 
The  careless  smoking  of  a  cigarette  in  bed  was  the  cause  of  the 
Cripple  Creek,  Colorado,  conflagration,  and  the  loss  of  the  life 
of  the  said  cigarette  smoker,  as  well  as  the  loss  of  the  lives  of 
many  others,  the  wrecking  of  homes  and  the  destroying  of  mil- 
lions of  dollars  in  property  values. 

During  the  thirty-four  years  from  1880  to  1913  inclusive,  the 
fire  losses  paid  by  the  fire  insurance  companies  in  the  United 


502  WORLD'S  INSURANCE  CONGRESS 

States  amounted  to  $3,054,745,850.  In  1913  alone  the  insurance 
companies  paid  a  total  loss  in  the  United  States  of  $158,157,414. 

While  these  sums  are  large,  yet  they  do  not  begin  to  cover  the 
total  loss  to  property  by  fire,  because  there  were  millions  and 
millions  and  still  more  millions  in  dollars  value  of  property  that 
burned  during  those  years,  on  which  there  was  no  insurance.  Con- 
sequently, we  have  no  definite  record  as  to  the  gross  amount  of 
loss  by  fire,  but  authorities  agree  to  an  estimate  of  one-third  more 
each  year  than  the  amount  paid  by  insurance  companies.  Each 
year  seems  to  show  an  increase  over  the  previous  year  and  the 
result  is  that  our  per  capita  annual  loss  is  estimated  to  average 
more  than  two  dollars  for  each  man,  woman  and  child  in  the 
United  States,  while  in  Europe  the  per  capita  loss  is  only  30  cents, 
which  is  about  one-seventh  of  the  appalling  amount  paid  by  the 
people  of  the  United  States. 

New  York  has  more  fires  annually  than  all  the  capitals  of  Eu- 
rope combined.  Sometimes  it  is  a  good  thing  to  make  comparison, 
and  I  am  going  to  quote  from  a  report  of  the  Committee  on  Sta- 
tistics of  The  National  Board  of  Fire  Underwriters:  "Our  per 
capita  loss  for  1913  amunted  to  more  than  two  dollars.  For  the 
same  year,  per  capita  of  Austria,  25  cents ;  England,  33  cents ; 
France,  49  cents ;  Germany,  29  cents ;  Ireland,  28  cents ;  Italy,  25 
cents;  Norway,  32  cents;  Russia,  89  cents;  Switzerland,  15  cents; 
and  in  the  Netherlands,  11  cents.  Our  per  capita  losses  in  a  few 
of  the  larger  cities  in  1913  were  as  follows:  New  York,  $1.36; 
Chicago,  $2.25;  Philadelphia,  $1.33;  Boston,  $5.79;  Baltimore, 
$1.84;  Cleveland,  $1.30;  Cincinnati,  $2.71;  Detroit,  $2.96;  Mil- 
waukee, $2.35  ;  Minneapolis,  $1.79  ;  New  Orleans,  $1.47  ;  Pittsburg, 
$1.28;  St.  Louis,  $2.38;  San  Francisco,  $2.27;  Washington,  $1.41; 
Los  Angeles,  $3.29;  Kansas  City,  $4.08."  An  unknown  percentage 
of  our  losses  are  incendiary,  consequently  we  will  not  hazard  a 
percentage  estimate,  but  the  origin  from  carelessness  seems  to  be 
pretty  satisfactorily  agreed  upon. 

In  1911  the  United  States  and  Canada  had  a  fire  loss,  in  value 
of  property  destroyed,  of  $234,377,250,  aiid  the  United  States  Geo- 
logical Survey,  in  its  report  as  to  causes,  estimated  that  fully 
fifty  per  cent  of  these  fires  originated  through  pure  carelessness, 
hence  half  that  enormous  sum  could  have  been  saved  to  general 
circulation  through  business  channels,  by  a  reasonable  amount 
of  care,  instead  of  an  unreasonable  amount  of  carelessness,  or  I 
might  add,  criminal  carelessness. 

The  people  must  be  educated  to  the  necessity  of  the  proper  care 
if  we  would  lessen  this  drainage  on  the  world's  wealth.  Every 
organization  and  every  individual  that  is  working  to  this  end  is 
accomplishing  good,  and  there  are  numerous  organizations  work- 
ing along  Ihc  lines  of  Fire  Prevention.  The  world's  conference  of 
all  interested  would  result  in  adopting  new  arguments  and  now 
methods  and  at  the  same  time  give  a  publicity  to  the  subject  that 
would  accomplish  more  good  than  we  who  are  directly  in  touch 


WORLD'S  INSURANCE  CONGRESS       503 

with  the  subject  could  have  dreamed  were  possible  when  this 
campaign  started  comparatively  a  few  years  ago. 

Where  our  people  have  given  the  subject  conscientious  consid- 
eration, they  have  been  awakened  to  the  necessity  of  education 
along  these  lines.  Foreign  countries  have  more  stringent  building 
laws  than  we  have.  The  question  of  faulty  construction  enters 
in  as  well  as  the  national  carelessness.  There  is  a  lack  of  efficiency 
in  our  building  codes  and  a  lack  of  enforcement  of  those  we  have. 
Fireproof  rooting  should  become  a  national  law.  Wooden  shingles 
should  be  absolutely  tabooed,  and  this  can  be  accomplished  only 
by  our  law  makers. 

We  cannot  seem  to  realize  that  each  time  the  watch  ticks  off  a 
second  $8  is  consumed  by  fire.  This  is  $480  a  minute,  $28,000  an 
hour,  and  $691,200  a  day. 

There  is  no  limit  to  the  good  that  can  be  accomplished  from  a 
general  conference  of  all  interested  in  the  subject,  and  it  is  fitting 
indeed  that  this  conference  should  be  held  in  a  city  that  can  point 
to  the  horror  of  the  greatest  conflagration  of  present  day  history. 
Every  insurance  interest  should  be  represented  in  this  conference, 
also  every  association  organized  for  the  express  purpose  of  reduc- 
ing the  fire  waste,  and  still  further,  every  organization  that  is  for 
the  purpose  of  helping  humanity  should  be  interested  and  take 
part  in  this  conference. 

In  my  opinion,  through  no  single  source  could  more  be  accom- 
plished for  good  than  through  the  Women's  Clubs  of  the  country, 
and  it  is  to  be  sincerely  hoped  that  they  will  send  large  delegations 
to  this  Congress,  as  they  will  be  given  every  recognition.  They 
will  reach  the  home  in  their  efforts  along  the  line  of  fire  prevention 
work  as  no  other  workers  could,  and  we  want  their  counsel  and 
advice. 

All  selfish  interests  must  be  put  aside  if  we  would  benefit  hu- 
manity as  the  opportunity  affords.  There  are  none  who  know  all 
the  best  methods  to  adopt  in  advancing  this  movement,  but  in  this 
conference  the  best  from  each  will  be  brought  forth,  and  from 
this  "Melting  Pot"  will  come  a  concrete  plan  for  future  work 
that  will  set  us  years  ahead  in  our  accomplishments. 

YOUR  FRIEND— AND  MINE  * 

Published  by  The  Insurance  Field  Co.,  Louisville,  Ky, 

Within  trumpet  call  of  this  great  International  Exposition 
stands  in  living  splendor  the  greatest  monument  to  Insurance 
that  history  has  ever  recorded.  At  Chicago  in  1871,  at  Boston  in 
1872,  at  Baltimore  in  1904,  as  at  countless  other  smaller  centers 
at  other  times,  Fire  Insurance  has  spread  its  shield  over  the  home- 

*  Distributed  by  the  Commission  in  charge  of  the  Worhl  's  Insurance  Con- 
gress Events  and  at  the  booth  of  the  Collective  Insurance  and  Universal 
Safety   Exliibit   at   the   Panama- Pacific  International    Exposition. 


504       WORLD'S  INSURANCE  CONGRESS 

less  and  desolated  and  left  the  record  of  its  power  to  protect.  At 
Galveston,  Life  Insurance  was  the  protector,  and  when  the  Titanic 
went  down  all  branches  of  Insurance  were  called  upon.  But  in 
the  disaster  that  came  upon  San  F'rancisco  in  1906,  Fire  Insur- 
ance, Life  Insurance  and  all  the  other  allied  sheltering  forms  of 
Insurance  came  to  the  rescue  and  replaced  in  civic  glory  and 
strength  the  destruction  of  that  which  had  required  generations 
of  labor  to  upbuild. 

To  the  reincarnation  of  San  Francisco,  leveled  in  three  days 
to  dust  and  ashes.  Insurance  brought  within  six  months  the  golden 
tribute  of  over  four  hundred  million  dollars,  gathered  in  remotest 
places  of  earth,  and  bade  the  stricken  city  arise^  clothe  itself  anew 
and  continue  its  splendid  career.  Of  this  vast  sum  fire  insurance 
contributed  about  $225,000,000  in  losses  paid;  life  insurance  con- 
tributed more  than  $100,000,000  in  cash  loaned  to  policyholders 
and  death  losses  paid,  besides  lending  $85,000,000  on  real  estate 
values;  the  remainder  came  from  casualty  and  miscellaneous  in- 
surance sources — each  doing  its  share  in  the  measure  of  the  call 
upon  it. 

Under  the  stimulus  of  this  golden  elixir  San  Francisco  rose 
from  her  ashes,  and  nine  years  later  is  now  presenting  to  the 
world  the  spectacle  of  the  Panama-Pacific  International  Exposi- 
tion. Not  since  Lazarus  rose  from  the  dead  has  there  been  a 
greater  miracle  accomplished.  After  nine  years  the  educational 
radiance  of  the  whole  world  shines  resplendent  where  smoke  and 
ruin  had  darkened  the  very  skies.  And  Insurance  was  the  sleep- 
less and  unwearying  force  that  transmuted  ruin  into  solid  sub- 
stance and  beauty. 

Insurance  is  the  organized  strength  of  the  Brotherhood  of  Man. 

For  man's  brotherhood  is  the  sharing  of  burdens,  binding  up 
wounds,  helping  those  stricken  and  sorrowing.  This  is  the  whole 
underlying  principle  of  the  outward  commercial  form  of  Insur- 
ance— a  system  of  business  organization  that  carries  the  greatest 
responsibilities  and  compensations  of  modern  society. 

Insurance !  We  are  wont  often  to  view  it  distrustfully,  more 
often  selfishly,  as  it  affects  us  individually. 

We  are  prone,  as  by  that  old  instinct  of  cruel  indifference — 
before  the  hope  of  the  Brotherhood  of  Man  was  spoken  on  the 
Mount  of  Olives — to  give  no  thought  to  the  broad  and  wholesome 
service  that  Insurance  renders  to  mankind,  from  the  humblest 
cottage  to  the  costliest  palace.  In  storm  and  fire,  in  death  and 
disease,  in  building  faith  unto  integrity,  in  upholding  the  hands 
of  the  weak  and  in  preserving  the  strength  of  the  strong — Insur- 
ance uniformly  assures  that  the  fruits  of  what  you  labor  to  achieve 
will  be  secured  to  you,  and  to  those  for  whom  you  have  labored, 
as  far  as  you  shall  have  achieved ;  that  nothing  which  you  may 
have  gained  for  them  shall  be  lost  by  any  of  the  accidents  that 
threaten,  but  that  it  shall  be  protected  for  their  use  and  enjoyment 
if  not  for  yours. 


WORLD'S  INSURANCE  CONGRESS       505 

There  are  many  of  us  who  have  felt  in  the  dark  hour  the  touch 
of  its  ministering  hand.  When  the  home  has  been  laid  in  ashes 
Insurance  has  provided  the  needed  shelter  and  reared  the  struc- 
ture anew.  When  the  property  that  has  been  accumulated,  great 
or  small,  has  been  destroyed  by  flames  or  winds  or  lightning,  it 
has  made  good  the  loss  and  saved  the  life-time's  labor.  When 
Death  has  stalked  in  and  laid  its  icy  hand  upon  the  breadwinner, 
or  any  of  the  family,  leaving  in  its  path  not  only  sorrow,  but  the 
inevitable  debt  and  despair  that  too  often  follow  that  sorrow,  then 
has  Life  Insurance  stepped  in  and  paid  the  debts  and  alleviated 
the  despair,  leaving  sorrow  there,  alas!  but  no  more  than  honest 
sorrow. 

It  may  be  less  than  death — it  may  be  accident — that  brings 
about  a  condition  almost  as  helpless  as  death,  for  a  time,  if  not 
forever;  and  Insurance  brings  its  relief,  pays  for  the  lost  time  or 
minimizes  the  permanent  helplessness.  Or,  the  average  man, 
whose  capital  is  in  his  hands,  his  brains,  eind  his  capacity  to  work, 
may  be  incapacitated  by  accident  or  disease  for  a  few  weeks,  or 
perhaps  months,  the  salary  or  wages  meanwhile  stopping,  but  the 
necessities  of  himself  and  his  family,  too,  continuing  and  increas- 
ing under  his  misfortune.  Insurance  comes  to  his  aid,  continuing 
part  or  all  of  his  wages  or  salary,  upholding  the  independence  of 
the  worker  and  cheering  him  to  quicker  recovery  and  full  com- 
mand of  his  former  strength. 

In  a  thousand  ways,  and  against  all  the  destructive  contingen- 
cies that  assail  man's  life,  his  property,  his  body,  his  health,  and 
his  security  against  disasters  that  come  every  day  in  well  ascer- 
tained measure — against  all  these  Insurance  is  the  common,  the 
ready  and  the  strongest  protector  that  human  society  has  ever 
yet  devised. 

This  is  the  dream,  largely  realized,  of  the  Brotherhood  of  Man. 

And  realized  upon  a  business  foundation  of  justice,  impartiality 
and  adaptability,  so  that  every  family  can  provide  for  the  pro- 
tection it  most  needs,  in  any  measure  it  thinks  best,  preserving 
its  honest  independence  and  yet  bearing  its  share  in  protecting 
others  as  it  is  itself  protected  by  others. 

But  Insurance  is  more  than  all  this :  It  is  the  father  and  mother 
of  Universal  Safety.  In  indemnifying  you  and  me  for  pecuniary 
losses  for  which  it  accepted  our  percentage  of  a  hundred  thousand 
estimated  losses  as  an  advance  deposit  or  premium  in  exchange  for 
its  guarantee,  it  performed  only  what  it  agreed  to  do.  Yet  that 
was  but  the  outward  and  visible  form  of  its  vast  fundamental 
service  in  preventing  waste,  conserving,  saving — Conservation.  At- 
tribute it  to  mere  business — the  desire  for  gain — if  you  will;  but 
the  effect  none  the  less  enters  into  the  uttermost  recesses  of  all 
modern  social  life  and  depends  upon  Service. 

Go  where  you  will,  the  length  and  breadth  of  the  land,  you  will 
find  evidences  of  this  foundation  work  of  Insurance.  It  is  the  link 
between  progress  and  conservation ;  it  is  natural  business  efficiency 


506  WORLD'S  INSURANCE  CONGRESS 

showing  men  how  they  can  develop  the  machinery  of  Commerce 
with  safety. 

The  modern  model  factory  is  developed  from  the  work  done 
by  Insurance.  The  building  is  erected  on  plans  which  insurance 
experts  have  demonstrated  at  least  liable  to  damage  in  case  of 
fire,  and  as  such  are  life  savers. 

The  building  is  protected  against  fire  within  by  fire  extinguish- 
ing and  preventing  devices  prescribed  by  Insurance. 

The  structure  is  protected  from  without  against  fire  being  com- 
municated to  it — still  the  result  of  tabulated  insurance  experience. 

It  is  situated  in  a  city  where  the  public  fire  service  is  operated 
on  principles  Insurance  has  demonstrated  to  be  most  efficient. 

The  machinery  in  the  factory  is  protected  with  devices  that  In- 
surance suggested  to  prevent  accident.  The  stairways  are  wide — 
the  exits  safeguarded.  Insurance.  The  air  is  pure,  the  surround- 
ings sanitar5^    Insurance. 

Whether  or  not  the  master  mind  which  conceived  and  erected 
this  model  structure  knows  that  Insurance  performed  the  service 
for  him,  does  not  affect  the  proposition.  To  Insurance  is  due  the 
credit  for  the  initial  impulse. 

Always  when  Insurance  suffers  loss  through  some  calamitj^  it 
sets  its  brightest  minds  to  work  to  prevent  a  recurrence  of  a  sim- 
ilar disaster. 

It  was  discovered  that  cleanliness  meant  a  reduction  in  fire 
loss.  Insurance  inaugurated  the  campaigns  for  cleanliness  which 
also  prevents  disease  and  is  a  natural  uplift. 

When  an  elevator  falls  and  causes  a  loss  to  Insurance,  the  fer- 
tile minds  work  to  prevent  elevators  from  falling. 

A  boat  sinks;  there  is  loss  of  life;  there  are  accidents;  the 
cargo  is  destroyed.  Insurance  has  lost  and  its  agents  at  once  seek 
the  cause  and  try  to  provide  a  remedy. 

Every  match — the  criminal  match — is  a  possible  fire  which  may 
mean  the  loss  of  life.    Insurance  decries  it. 

A  sane  July  4th.     Insurance. 

Safety  First — the  Insurance  idea.     It  prevents  accidents. 

Once  we  thought  plagues  and  epidemics  were  inevitable.  They 
are  preventable  through  sanitation — Insurance. 

A  widespread  movement  for  the  Porlongation  of  Life — Insur- 
ance. 

Special   nursing;  sanitorium   work — Insurance. 

There  is  not  an  avenue  of  social  and  commercial  life  in  which 
Insurance  does  not  enter  as  one  of  the  greatest  factors  in  the 
World's  progress.  Its  force  for  good  is  ceaseless.  While  it  has 
paid  your  loss  and  mine,  it  has  done  more — much  more :  it  has 
taken  a  part  of  its  due  and  accrued  profit  and  reinvested  it  each 
year  in  prevention  work,  thus  performing  a  service  the  value  of 
which  may  not  even  be  approximated  in  mere  dollars  and  cents. 

Insurance  collects  from  the  many  to  pay  the  few  who  are  un- 
fortunate  enough    to   meet    the   inevitable   disasters   that   become 


WORLD'S  INSURANCE  CONGRESS       507 

average  disasters  by  inexorable  laws.  It  exacts  from  us,  in  the 
form  known  as  ' '  premium, ' '  a  deposit  or  advance  payment,  which, 
when  gathered  with  the  deposits  of  the  other  ninety-nine  thou- 
sand nine  hundred  and  ninety-nine,  furnish  an  average  experience. 
Out  of  these  collective  deposits  or  premiums  Insurance  pays  your 
loss  and  mine,  sets  aside  a  fund  called  a  "reserve"  to  give  us 
added  security  and  meets  the  liability  assumed  under  its  contract 
with  us;  pays  the  agent  who  induced  us  to  protect  our  own  inter- 
ests; gives  us  knowledge  how  to  prevent  accident  and  prolong 
life;  has  our  risks  inspected,  one  by  one,  and  points  out  and  has 
corrected  defects  that  might  produce  loss ;  pays  its  taxes,  some  just 
and  others  unjust;  pays  its  administrative  expenses;  allows  it- 
self a  dividend  on  its  capitalized  investment,  if  there  is  anything 
left;  and  passes  a  balance  to  (or  in  years  of  excessive  loss  draws 
from)  its  accumulated  funds  that  give  security  and  stability  to  its 
contracts — assuring  its  payment  of  losses,  when  losses  come,  no 
matter  how  great  the  calamity. 

The  whole  system  of  Insurance  is  based  upon  the  law  of  aver- 
ages. So  many  buildings  burn  every  year;  so  many  accidents 
take  place ;  there  is  so  much  sickness ;  so  many  people  answer  the 
final  call.  While  the  average  experience  determines  the  average 
rate,  it  is  still  true  that  each  individual  participant  in  the  Society 
of  the  Insured  can,  in  a  measure,  raise  or  lower  the  average  and 
so  fix  his  own  costs  for  indemnity.  He  can  be  careful  and  cleanly, 
live  a  life  in  sanitary  surroundings  and  help  to  minimize  losses, 
prevent  accidents,  prolong  life  and  so  reduce  Insurance  costs. 
Insurance  is  naturally  competitive ;  its  costs  to  you  and  to  me 
rise  and  fall  in  the  very  measure  that  the  individual  standard  of 
each  participant  measures  with  the  same  standard  set  by  the 
whole. 

It  must  be  remembered  that  Insurance  restores  nothing  that 
is  lost.  In  principle  it  means  only  indemnity  for  loss.  Loss  is 
utter  destruction — Avaste.  Prevent  loss  and  you  prevent  that 
complete  waste  which  drains  the  resources  of  the  world;  prevent 
loss  and  you  raise  the  standard  of  humanity;  prevent  loss  and 
you  reduce  your  Insurance  cost. 

There  may  be  many  crudities  in  the  great  scheme  of  Insurance 
— what  plan  of  mere  man  is  perfect? — but  it  is  changing  every 
day  and  always  for  the  better.  From  whatever  point  it  is  viewed 
it  is  perfonning,  directly  and  indirectly,  the  greatest  combined 
commercial  and  altruistic  service  known  to  humanity. 

The  actuality  of  the  widespread  existence  of  Insurance  in  the 
United  States  in  every  form  is  shown  in  the  fact  that  in  the 
present  year  nineteen  hundred  and  fifteen  there  will  be  voluntary 
advance  deposits  made  for  that  service  amounting  to  one  billion, 
five  hundred  and  ninety-one  millions  of  dollars — much  more  than 
the  whole  mighty  Federal  Government  collects  from  all  its  taxes 
and  traffic  with  the  world.  In  this  service  more  than  300,000 
agents,  lay  workers  in  a  great,  practical  religion,  are  responsibly 


508  WORLD'S  INSURANCE  CONGRESS 

employed — a  lesser  number  than  are  employed  to  make  the  much 
smaller  collections  and  disbursements  of  the  Federal  Government. 

This  is  the  edifice  of  Insurance  in  the  United  States  alone.  It 
shelters  fifty  millions  of  our  people  directly  under  its  protection 
and  it  shelters  the  other  fifty  millions  indirectly  by  distributing 
and  minimizing  burdens,  providing  credits  and  preventing  the 
individual  losses  that  occur  from  impoverishing  those  dependent 
upon  its  protection  for  employment  and  self-support. 

The  practical  daily  and  hourly  service  of  the  Brotherhood  of 
Man  is  housed  in  this  great  edifice  of  Insurance.  Spiritually  and 
morally  the  soul  of  man  is  ministered  to  by  religion ;  but  in  these 
needs  of  the  soul,  as  well  as  in  the  material  protection  of  the 
body  of  man,  Insurance  is  the  organized  and  unfailing  machinery 
of  beneficence  and  mutual  dependence. 

The  National  voluntary  bill  for  Insurance  in  the  United  States 
the  present  year  has  been  given,  at  the  lowest,  as  $1,591,000,000. 
All  of  that  vast  sum,  except  the  mere  expense  of  collecting  and 
distributing  it,  goes  back  directly  to  those  who  have  lost  by  mis- 
fortune during  the  year,  or  for  the  security  of  those  who  will 
lose  the  next  and  following  years.  This  annual  bill  for  all  kinds 
of  Insurance  can  be  approximately  estimated  as  follows: 

For  life  insurance $    891,000,000 

For  fire  and  marine  insurance 450,000,000 

For  casualty  and  miscellaneous  insurance 250,000,000 

Total  annual  premiums  or  advance  deposits $1,591,000,000 

AVhile,  for  purposes  of  presenting  these  figures  concretely,  the 
business  in  all  its  mighty  ramifications  has  been  divided  into  three 
groups,  each  is  subject  to  subdivisions  until  the  whole  need  of 
humanity  is  covered  by  varied  forms  devised  and  carried  out  by 
the  great  stock  and  mutual  organizations  of  the  country — sound 
and  solvent,  through  Supervision,  and  as  worthy  of  confidence  as 
the  Treasury  and  good  faith  of  the  United  States. 

Life  insurance:  this  is  one  of  the  immediate  needs  of  every 
family.  It  comes  in  a  form  that  meets  all  requirements — individ- 
ually or  collectively.  It  may  be  made  to  protect  mortgages  or 
debts;  it  can  be  made  to  protect  partnerships  or  valuable  em- 
ployees; it  will  embrace  groups  of  employees;  it  may  be  made 
payable  while  you  live ;  it  Avill  protect  your  dependents  when  you 
die,  in  a  lump  sum  or  installments  or  as  an  annuity  to  protect  your 
old  age.  It  is  universal  in  its  application,  far-reaching  in  its 
benefits.  Industrial  life  insurance  alone  is  carried  in  thirty  mil- 
lions of  policies  in  the  United  States.  The  cost  is  small  and  the 
protection  is  well  known,  complete  and  ready. 

Fire  and  marine  insurance:  Here  we  have  perils  land  and  sea 
covered ;  property  losses  occasioned  by  fire,  water,  lightning,  wind 
and  hail— the  elements.     It  is  the  bulwark  of  commerce,  the  basis 


WORLD'S  INSURANCE  CONGRESS  509 

of  the  world's  credit.     Its  ramifications  are  everywhere,  its  forms 
many  and  varied. 

Casualty  and  miscellaneous  insurance :  Under  this  group  is  em- 
braced the  varied  forms  that  enter  so  keenly  into  commercial  life — 
accident  and  health,  adjusted  for  all  classes ;  liability  covering 
the  manufacturer  or  the  individual  for  his  legal  responsibilities  to 
others;  workmen's  compensation,  the  protection  of  the  workers; 
credit  insurance  that  guarantees  your  accounts;  surety — a  bond; 
fidelity,  assuring  you  against  the  dishonesty  of  others;  plate  glass, 
offsetting  loss  from  breakage;  burglary,  theft,  automobile  liabil- 
ity, steam  boiler,  elevator,  live  stock  insurance.  And  there  are 
other  forms  developed  from  men's  necessities  and  liability  to  suffer 
loss,  and  there  will  be  still  others.  Miscellaneous  insurance  forms 
are  growing  rapidly ;  they  are  daily  becoming  more  popular  and 
are  more  nearly  meeting  the  great  service  for  which  they  were 
devised. 

These  all  form  a  part  of  the  Nation 's  great  annual  insurance  bill 
of  $1,591,000,000  which  is  being  collected  day  by  day,  and  dis- 
tributed for  your  benefit  and  mine  in  proportion  as  burdens  and 
calamities  may  fall  upon  us. 

How  is  this  vast  amount  of  $1,591,000,000  for  insurance  paid? 
How  does  every  family  of  the  one  hundred  millions  of  population 
bear  its  share  of  the  burden  while  the  careless,  indifferent  or  the 
overcunning  lose  the  benefits  of  its  distribution?  If  you  have  not 
thought  of  it,  it  is  well  that  you  should  know.  For,  as  the  service 
that  Insurance  seeks  to  render  is  universal  in  its  office,  it  reaches 
directly  or  indirectly  every  one  of  the  population,  and  directly  or 
indirectly  in  proportion  as  he  receives  its  benefits  every  one  bears 
his  share  of  the  burden. 

The  per  capita  cost  of  insurance  in  the  United  States  is  $15.91 
this  year,  or  for  the  average  family  of  five  $79.55.  While  that  is 
the  per  capita  and  family  cost,  many,  of  course,  pay  much  less 
and  many  pay  much  more.  But  at  the  very  least  each  family  pays 
the  insurance  upon  what  it  uses  and  consumes  for  the  year.  Of 
those  families  that  pay  no  direct  insurance,  many  lose  far  more 
than  their  insurance  bills  by  suffering  losses  against  which  they 
are  not  protected.  They  are  as  the  Foolish  Virgins  whose  lamps 
were  not  lighted  when  the  bridegroom  approached. 

The  man  who  pays  his  share  of  the  Nation 's  insurance  bill  with- 
out receiving  any  benefit  in  personal  protection  is  manifestly  losing 
one  of  the  great  advantages  of  social  organization  and  is  carrying 
more  burden  than  he  should.  If  you  will  observe  closely  you 
will  discover  that  the  best  and  the  ablest  business  men,  the  best 
salaried  men  and  wage-earners,  do  not  make  such  a  mistake.  With 
rare  exceptions,  that  which  they  own,  or  which  constitutes  their 
working  capacity,  is  always  protected  by  insurance  against  com- 
mon and  special  perils  that  threaten. 

Some  thoughtless  persons  think  they  have  nothing  to  insure. 
But  every  active  man  has  something  to  insure,  for  the  protection 


510       WORLD'S  INSURANCE  CONGRESS 

of  which  some  one  of  the  kinds  of  insurance  has  been  devised.  Let 
us  take  for  example  event  the  man  who  imagines  he  possesses  noth- 
ing to  insure  because  he  owns  no  pecuniary  capital,  no  accumulated 
property  of  value,  but  yet  who  by  his  daily  labor  supports  his  wife 
and  three  children — the  average  family  group.  He  may  be  a 
skilled  artisan  or  a  salaried  employee  who  earns,  let  it  be  assumed, 
one  thousand  dollars  a  year.  He  lives  in  a  rented  house,  he  goes 
to  and  from  his  work  on  street  cars,  he  purchases  all  the  supplies 
he  requires  in  small  quantities,  and  needs  the  service  occasionally 
of  the  doctor  and  other  members  of  the  business  community,  who 
are  a  little  better  placed  pecuniarily,  perhaps,  than  he  is.  The 
owner  of  the  house  carries  fire  and  wind-storm  insurance  for  which 
he  pays  and  the  cost  of  which  is  added  into  the  rent  the  tenant 
pays.  The  grocer,  clothing  merchant,  furniture  man  and  coal 
dealer  all  carry  insurance  upon  their  stocks  for  which  they  pay 
and  the  cost  of  which  is  in  turn  added  to  the  selling  price  of  their 
wares.  The  doctor  carries  physicians'  defense,  the  druggist  a  lia- 
bility policy,  and  all  carry  life  or  other  insurance,  the  amount  of 
which  is  merged  into  the  cost  of  their  living  and  is  charged  into 
their  bills  for  service.  The  street  railway  company  carries  sev- 
eral kinds  of  protection  insurance,  the  cost  of  which  is  entered 
under  the  head  of  operating  expenses  and  is  in  turn  charged  into 
the  fare  or  the  transfer  privileges  of  the  road. 

In  every  direction  in  which  the  head  of  this  little  family  turns 
to  purchase  supplies  and  service  such  as  the  family  needs,  he  finds 
himself  paying,  a  few  cents  at  a  time,  the  insurance  bills  of  others 
that  have  accumulated  up  to  that  moment.  In  this  way,  at  the 
end  of  the  year,  he  will  have  paid  his  per  capita  insurance  bill  of 
$15.91,  or  $79.55  for  the  five  members  of  his  family.  And  yet, 
though  he  has  paid,  he  has  purchased  no  protection  for  what  he 
has  bought,  or  for  his  family.  If  any  of  the  losses  which  insur- 
ance is  intended  to  protect  should  fall  upon  himself,  his  family,  or 
his  goods,  he  will  find  he  has  been  gambling  with  chance,  has  car- 
ried his  own  insurance  and  must  bear  the  w^hole  loss.  Often  the 
result  is  that  the  family  is  plunged  into  hardship  and  poverty, 
broken  up  and  dispersed,  where  direct  insurance  would  have  come 
instantly  to  the  rescue  and  prevented  the  disaster. 

If,  without  exception,  every  citizen  of  the  United  States  insured 
his  life  in  the  measure  of  his  earning  capacity  and  his  property 
to  its  value,  and  a  tax  was  made  on  these  premium  payments  for 
the  purpose  of  general  State  revenue,  the  tax  might  not  then  be 
considered  unjust. 

It  is  right  that  insurance  should  be  taxed  for  supervision,  be- 
cause supervision  is  the  people's  guarantee  of  security.  T>ut  when 
insurance  premiums  are  taxed  and  turned  into  general  revenue 
funds  to  be  expended  for  the  benefit  of  all  alike,  those  who  were 
provident  enough  to  insure  pay  a  tax  for  the  improvident — the 
unin.sured.  It  is  closely  estimated  that  the  special  tax  on  deposits 
of  life  insurance  policyholders  alone  would  buy  $600,000,000  addi- 


WORLD'S  INSURANCE  CONGRESS       511 

tional  protection.  This  is  unquestionably  a  conservative  estimate, 
as  the  total  tax  paid  on  all  premiums  is  upward  of  twenty  millions 
of  dollars  annually,  while  the  cost  of  supervising  insurance  is  less 
thau  one  and  one-half  millions.  In  these  figures  are  not  included 
regular  taxes  upon  property,  such  as  we  all  pay  and  should  pay, 
but  they  are  in  the  nature  of  a  special  State  assessment  you  pay 
for  the  privilege  of  protecting  your  life  and  property. 

You,  as  one  insured,  are  therefore  contributing  your  share  of, 
let  us  say,  eighteen  millions  annually,  just  as  nuich  of  which  goes 
to  the  practical  benefit  of  your  uninsured  neighbor  as  yourself. 
You  are  being  penalized  for  your  thrift  in  providing  for  yourself, 
in  keeping  yourself  from  being  a  charge  on  your  neighbors  be- 
cause, naturally  enough,  you  pay  the  cost  of  the  tax  in  the  pre- 
mium you  pay  in  advance  of  loss  to  indemnify  you  when  the  loss 
comes. 

Supervision  is  the  great  assurance  of  stable  insurance.  But 
there  is  no  justification  in  taxation  of  Insurance  premiums  of  a 
part  for  the  general  revenues  of  all. 

The  future  of  Insurance !  It  is  the  future  of  the  people  of  the 
United  States  as  well  as  of  the  inhabitants  of  all  the  world.  The 
growth  of  this  many-sided  service  is  the  pioneer  of  the  higher 
civilization.  In  the  past  twenty  years  Insurance  has  increased 
fourfold  in  the  United  States.  It  is  conceivable  that  a  time  may 
come  when  the  largest  majority  of  the  whole  population  will  be 
directly  protected  by  one  or  another  of  its  forms. 

There  are  not  wanting  those  who  believe  that  the  protection  of 
every  one  of  the  population  can  be  secured  by  some  compulsory 
governmental  law  that  will  force  the  individual  to  carry  direct 
insurance. 

Such  a  suggestion  is  fraught  with  menace.  State  insurance  is 
inevitably  faulty  in  practical  administration  as  in  fundamental 
theory.  For  centuries  men  have  sought  the  ideal  in  forms  of  gov- 
ernment. As  an  abstract  proposition  the  philosophers  are  agreed 
that  a  "benevolent  despotism"  Avould  best  promote  the  welfare  of 
all.  As  a  practical  governmental  scheme  of  administration,  how- 
ever, the  same  philosophers  agree  that  a  "benevolent  despotism" 
is  an  impossibility.  The  reason  is  plain.  Administrators  of  gov- 
ernment are  human  and  therefore  live  their  brief  span  and  pass 
on.  But  government  for  a  nation,  or  a  subdivision  of  a  nation, 
must  be  a  continuing  thing  and  as  free  as  possible  from  changes 
inseparably  a  part  of  individual  human  life. 

In  other  words,  government,  in  order  to  be  stable,  must  be  based 
upon  that  immutable  foundation  of  Insurance — the  Law  of  Aver- 
age. 

Only  those  forms  of  organization  into  which  men  enter  of  their 
own  conscious  free  will  give  an}^  assurance  of  permanency.  The 
increasing  millions  of  men  who  are  making  provision  through  in- 
surance to  protect  the  varied  interests  of  life  and  property,  co- 
operate consciously  toward  a  beneficent  end.    Through  the  machin- 


512  WORLD'S  INSURANCE  CONGRESS 

ery  of  the  commercial  forms  of  insurance — forms  in  which  long 
experience  has  developed  the  highest  efficiency — men  actually  obey 
the  injunction  "Bear  ye  one  another's  burdens." 

No  one  would  be  foolish  enough  to  contend  that  the  last  word 
has  been  said  in  the  organization  of  the  commercial  forms  of  in- 
surance. But  this  fact  is  indisputable :  these  forms  of  organiza- 
tion are  so  delicately  attuned  to  the  interests  of  men  who  volun- 
tarily become  members  of  them  that  they  immediately  respond 
when  the  need  for  change  is  apparent  and  demand  is  made  for 
greater  efficiency.  By  the  simple  and  almost  miraculously  effective 
expedient  of  withholding  their  support  from  incapably  managed 
companies,  men  may  work  reforms,  as  it  were,  in  the  twinkling  of 
an  eye. 

No  such  efficiency  and  delicate  responsiveness  to  the  demand 
for  change  can  possibly  characterize  State  socialism  as  manifested 
in  States  insurance.  Let  it  be  realized  that  forms  of  government, 
as  well  as  individual  tyrants,  may  be  invested  with  the  attributes 
of  despotism.  Any  proposition  to  have  government  do  for  men 
those  things  which  they  can  and  should  do  for  themselves  inevit- 
ably tends  to  weaken  the  fiber  of  the  individual  citizen.  Neither 
in  governments  nor  in  morals  can  the  citizen  evade  individual  re- 
sponsibility. Every  evasion  of  personal  responsibility  means  a 
shifting  of  responsibility  and  power  to  another  and  when  the  in- 
dividual so  evades  responsibility  he  loses  his  liberty  in  that  exact 
degree.  Hence  it  follows  that  in  forms  of  business,  as  in  forms 
of  government,  those  forms  are  most  stable  and  most  efficient  in 
which  individuals  consciously  enroll  themselves  as  members. 

The  very  best  that  government  can  do  for  Insurance  as  a  social 
and  business  activity  is  to  encourage  it  with  wise  protective  laws, 
and  to  lift  the  burdens  of  unnecessary  taxation  from  it.  The  sys- 
tem itself  will  work  out  its  own  extension  to  the  last  point  of 
development. 

Before  everything,  except  food,  shelter  and  clothing,  Insurance 
should  take  its  place  because  it  protects  all  else. 

Once  the  insurance  idea  is  established  as  a  necessity,  the  great 
and  noble  work  of  loss  prevention  develops  to  its  maximum  effi- 
ciency, giving  us  a  race  of  progressive,  healthy,  long  lived,  un- 
maimed  human  beings  who  are  conserving  the  vast  resources  of 
the  country  and  logically  abating  their  insurance  costs  to  an  ab- 
solute minimum. 

This  is  the  work  ahead  of  insurance  agents  and  companies — a 
work  of  encouragement  and  evangelization,  not  the  cold  and  un- 
feeling enforcement  of  bureaucratic  government. 

The  great  economic  force  known  as  Insurance  is  visualized  in 
the  Collective  Insurance  and  Universal  Safety  Exhibit  in  the 
Mines  Palace  at  the  Panama-Pacific  International  Exposition, 
where  some  of  the  important  elements  entering  into  its  foundation 
work  are  ompliasi/od  to  show  the  wonderful  results  being  accom- 
plished.   To  visualize  every  ramification  would  require  an  Exposi- 


WORLD'S  INSURANCE  CONGRESS       513 

tion  in  itself — and  in  fact  this  whole  Exposition  is  erected  on  the 
Insurance  idea.  Every  late  insurance  development  in  fire  pre- 
vention, safety,  sanitation  and  succor  embraced  in  the  Exposition 
itself  is  but  a  part  of  the  underlying  principle  that  makes  Insur- 
ance such  a  force.  And  in  the  wealth  of  superior  and  perfected 
exhibits  displayed  throughout  the  Exposition  the  same  force  is 
manifest. 

The  booth  of  the  Collective  Insurance  and  Universal  Safety  Ex- 
hibits is  designed  to  entert-ain  and  provide  for  the  comfort  of  pol- 
icyholders, agents  and  friends  of  participants — friends  of  Insur- 
ance— and  to  make  them  new  friends.  It  is  constructed  in  a  sub- 
stantial way,  without  pretense,  but  to  carr}^  out  the  fundamentals 
of  Insurance  in  all  is  branches,  linked  by  the  great  chain  of  the 
social  service  performed  by  its  agents  in  the  field. 

Above  the  facade  of  one  of  the  three  main  entrances  is  a  figure, 
"The  Spirit  of  Insurance,"  overcoming  the  three  great  dragons  of 
Fire,  Accident  and  Death,  and  holding  aloft  the  green  light  of 
Safety.  Along  the  facade  are  banners  indicating  the  service  per- 
formed by  Insurance. 

Within  the  exhibit  you  will  find  a  panorama  of  San  Francisco 
as  it  appeared  nine  years  ago  after  the  greatest  conflagration  in 
the  history  of  the  world.  Through  the  magic  wand  of  Insurance 
ma3^  be  seen  a  reconstructed  San  Francisco — nine  years  after — 
the  city  known  as  Exhibit  A  of  the  Panama-Pacific  International 
Exposition. 

In  the  booth,  too,  you  may  observe  the  great  institution  of  Life 
Insurance  drained  at  $24  every  minute  of  every  day  and  night 
as  a  tax  to  maintain  general  State  revenues ;  $13,000,000  to  be  a 
football  for  politicians  every  year.  That  is  your  insurance  money 
that  is  being  spent  as  much  for  the  benefit  of  your  uninsured 
neighbor  as  yourself. 

Who  wants  to  see  his  home  burn,  take  all  the  chances  of  acci- 
dent, and  lose  his  treasured  collections  of  a  lifetime  even  though 
insured  ?  Well,  you  see  a  house  burn  here  and  can  imagine  what 
might  happen  to  you,  and  you  can  determine  if  you  will  help  to 
minimize  the  great  waste  that  is  draining  the  Nation  annually. 

The  Criminal  Match!  Do  you  know  how  many  fires  it  causes 
every  year? 

Who  wants  to  break  his  arm — or  his  neck — even  though  insured  ? 
Get  the  Safety  First  habit — the  Insurance  idea.  You  will  find 
here  many  devices  to  save  and  prolong  life  and  prevent  accidents 
all  of  which  are  natural  reducers  of  the  insurance  cost  and  which 
are  the  outgrowth  of  Insurance  itself.  Where  else  can  you  find 
a  business  that  spends  a  part  of  its  earned  profits  everj^  year  to 
bring  about  lower  costs  to  the  consumer? 

That  is  what  Insurance  does;  that  is  what  the  participants  in 
this  Exhibit  do. 


514  WORLD'S  INSURANCE  CONGRESS 


OPINIONS  EXPRESSED  BY  PROMINENT  INSURANCE  MEN 

Regarding  the  World's  Insurance  Congress  of  the  Panama- 
Pacific  International  Exposition 

"I  am  much  impressed  with  the  plan  which  contemplates  bring- 
ing together  the  representatives  of  all  kinds  of  insurance,  believing 
that  such  a  Congress  would  do  much  in  the  way  of  calling  atten- 
tion to  the  dignity  and  importance  of  the  insurance  business  as 
a  whole." — Robert  Lynn  Cox,  General  Counsel  and  Manager,  As- 
sociation of  Life  Insurance  Presidents. 

'*No  doubt  much  good  can  be  done  for  the  insurance  business 
through  the  World's  Insurance  Congress." — E.  Jay  Wohlgemuth, 
President,  The  Western  Underwriter  Company. 

''I  assure  you  that  any  support  which  I  and  my  Company  can 
accord  to  this  movement  will  be  fully  at  your  disposal." — Charles 
H.  Holland,  General  Manager,  Royal  Indemnity  Company,  New 
York. 

"The  World's  Insurance  Congress  of  Insurance  foreshadows 
broader  national  and  international  conceptions  of  a  business  which, 
by  common  consent,  now  ranks  foremoset  among  the  institutions 
making  for  human  betterment." — Forrest  F.  Dryden,  President, 
The  Prudential  Insurance  Company  of  America. 

'  *  The  Congress  will  mark  an  epoch  in  the  history  of  the  business 
and  in  many  ways  the  interests  not  only  of  those  engaged  in  this 
line  of  business,  but  of  the  public  generally,  will  be  most  substan- 
tially promoted." — Bayard  P.  Holmes,  President,  Hooper-Holmes 
Bureau. 

"The  forming  of  this  Congress  is  and  will  continue  to  be  a  con- 
structive movement  of  international  importance,  a  great  forward 
step,  broadening  and  extending  our  vision  in  insurance  affairs." — 
W.  S.  Diggs,  Chairman,  National  Council  of  Insurance  Federation 
Executives. 

"I  desire  to  give  strong  endorsement  to  the  World's  Insurance 
Congress.  I  do  not  recall  anything  in  the  history  of  insurance  and 
publicity,  of  greater  importajtice  than  the  establishment,  through 
the  initiative  of  Commissioner  Hathaway,  of  this  Congress,  with 
all  its  splendid  possibilities." — Chas.  H.  Boyer,  ]\Ianager,  Casu- 
alty Department,  National  Life  Insurance  Company  of  U.  S.  A. 

"Such  a  gathering  would  be  of  much  interest  and  value." — 
George  I.  Cochran,  President,  Pacific  Mutual  Life  Insurance  Com- 
pany. 

"I  believe  that  the  World's  Insurance  Congress  is  going  to  be 
a  big  thing,  and  I  wish  to  do  whatever  I  can  in  my  small  way 
to  make  it  of  value  to  those  who  are  engaged  in  the  insurance 
business,  and  also  to  the  insuring  public." — R.  R.  Gilkey,  Sec- 
retary, The  Surety  Association  of  America. 


WORLD'S  INSURANCE  CONGRESS       515 

"I  am  fully  in  sympathy  with  the  work  contemplated  by  the 
"World's  Insurance  Congress,  aiid  feel  satisfied  that  much  good  can 
be  accomplished  through  this  branch  of  the  Exposition." — E.  C. 
Ralle,  Manager,  Western  Department,  Gerraania  Fire  Insurance 
Co.,  Chicago,  111. 

"We  are  in  hearty  sympathy  with  your  work  for  the  World's 
Insurance  Congress." — L.  A.  Mack,  President,  The  Weekly  Under- 
writer, New  York. 

"I  believe  that  if  some  permanent  organization  can  be  effected 
as  the  result  of  the  Congress  it  will  mark  a  new  era  in  the  con- 
structive influence  of  insurance  in  America." — E.  W.  DeLeon, 
President,  Casualty  Company  of  America. 

"It  is  the  hope  and  expectation  of  The  Spectator  that  the  pro- 
ceedings of  the  World's  Insurance  Congress  will  redound  to  the 
benefit  of  insurance  throughout  the  universe." — A.  L.  J.  Smith, 
President,  Spectator  Publishing  Company. 

"Regarding  the  possibility  of  a  permanent  organization  of  the 
National  Council,  it  would  seem  desirable  that  such  a  joint  coun- 
cil should  be  formed." — H.  H.  Putnam,  Secretary,  National  Asso- 
ciation of  Insurance  Agents. 

"It  must  be  productive  of  good  results  to  the  insurance  business 
generally." — Cecil  F.  Shallcross,  New  York  Manager  of  the  Royal 
Insurance  Company. 

"A  great  meeting  held  in  the  interests  of  a  great  business." — 
T.  J.  Falvey,  President,  Massachusetts  Bonding  and  Indemnity 
Company. 

"One  of  the  greatest  educational  forces  that  was  ever  under- 
taken."— C.  I.  Hitchcock,  President,  The  Insurance  Field  Co.,  Inc. 

"You  have  a  far-reaching  and  useful  program." — Charles  A. 
Peabody,  President,  The  Mutual  Life  Insurance  Co.  of  N.  Y. 

Probably  no  one  event  of  as  much  and  far-reaching  importance 
to  insurance  has  ever  been  planned  or  executed.  The  work  in- 
volved and  the  courage  of  your  conception  is  appreciated  by  very 
few." — Edward  A.  Woods,  President,  The  National  Association  of 
Life  Underwriters. 

In  addition  to  the  many  private  opinions  expressed,  a  number  of 
the  country's  leading  insurance  journals  devoted  unlimited  col- 
umns of  editorial  space  to  Congress  possibilities,  and  on  occasion, 
issued  special  editions  for  the  sole  purpose  of  helping  the  cause. 
Prominent  among  such  papers  are  the  Inmramce  Field,  The  Spec- 
tator, Western  Underwriter,  Insurance  Press,  Bough  Notes,  West- 
ern Insurance  Review  and  a  long  list  of  others  of  minor  importance. 


516  .  WORLD'S  INSURANCE  CONGRESS 


LETTERS  RELATING  TO  THE  PLAN  FOR  PUBLICATION 

OF  THIS  WORK 

This  record  would  not  be  complete  if  it  did  not  contain  the  fol- 
lowing three  letters,  directed  to  the  members  of  the  Provisional 
Central  Committee  of  the  National  Insurance  Council  by  Commis- 
sioner W.  L.  Hathaway  of  the  World's  Insurance  Congress. 

The  first  general  letter  so  directed,  dated  October  19th,  1915, 
contained  official  notification  of  the  Committee's  appointment,  as 
well  as  brief  suggesions  in  regard  to  certain  lines  which  it  seemed 
of  obvious  advantage  to  follow.    The  letter  follows: 

To  Members  op  the  Provisional  Central  Committee, 
National  Insurance  Council. 

Gentlemen : 

I  take  this  form  of  making  of  official  record  your  appointments 
as  members  of  the  Provisional  Central  Committee  provided  for  in 
the  enclosed  Tentative  Plan  of  Organization  for  a  National  In- 
surance Council,  adopted  by  the  National  Council  of  the  AVorld's 
Insurance  Congress  at  its  executive  meeting  Saturday,  October 
9th,  at  which  time  your  names,  as  provided,  were  selected  by  the 
Executive  Committee  of  this  Commission,  brought  before  the  Na- 
tional Council  in  session,  and  unanimously  ratified. 

For  your  further  information  I  will  state  that  upon  the  request 
of  the  Chairman  and  Secretary  elected  by  you,  ^Messrs.  Charles  H. 
Holland  and  ]\Iark  T.  McKee,  I  am  having  prepared  in  typewritten 
form  all  the  various  historical  facts  of  this  work  from  its  incep- 
tion, together  with  all  addresses  and  papers  that  have  been  deliv- 
ered in  the  various  events,  including  the  Congress;  as  well  as  a 
number  of  valuable  papers  that  were  written  by  men  of  promi- 
nence in  the  insurance  world  and  widely  distributed,  outlining 
what,  in  their  opinions,  could  be  accomplished  through  the  move- 
ment. 

These  papers  will  reach  your  hands  at  the  earliest  possible  date 
considering  the  vast  amount  of  work  necessary  in  their  prepara- 
tion, which  I  have  only  undertaken  after  due  consideration  of  the 
fact  that  it  would  be  difficult  for  any  one  not  familiar  with  the 
work  from  its  inception  to  prepare  them  in  consecutive  order  and 
avoid  the  danger  of  leaving  out  some  important  detail  that  would 
bring  the  whole  work  before  you  in  its  constructive  sequence  so  as 
to  permit  of  its  being  edited  in  such  form  as  to  retain  a  clear 
understanding  of  the  gradual  growth  of  the  ideas  which  found 
such  expression  in  the  Congress  as  to  result  in  the  unanimous  de- 
cision of  the  National  Council  to  perpetuate  the  work. 

It  is  also  hoped  that  the  papers  presented  in  this  consecutive 
form  will  furnish  the  members  of  your  committee  with  a  very 
clear  understanding,  and  we  believe  impressive  suggestion,  as  to 
the  immediate  future  direction  which  the  work  of  the  National 
Council  can  best  take  to  perpetuate  it  as  a  national  force. 

This  side  of  the  subject  was  little,  if  at  all,  discussed  in  com- 


WORLD'S  INSURANCE  CONGRESS       517 

mittees,  for  the  reason  that  we  felt  the  final  committee  would  best 
come  to  understand  the  natural  trend  upon  which  this  work  could 
best  be  conducted  by  a  studious  reading  of  the  history  and  papers 
as  they  will  be  presented,  from  wliich  you  will  gather  that  for 
several  years  past  we  have  been  reaching  a  large  reading  public 
with  papers  very  similar  in  educational  value  to  those  delivered  at 
the  Congress — all  tending  to  a  better  understanding,  particularly 
among  insurance  men  themselves,  of  the  real  broad  public  service 
which  the  various  branches  are  performing. 

We  feel  sure  that  in  reading  this  work  in  sequence  you  will  more 
forcibly  realize  the  extent  to  which  it  gathered  force  as  it  pro- 
gressed, from  a  time  when  at  its  inception  it  was  almost  impossible 
to  get  a  hearing,  until  the  final  papers  of  the  Congress,  in  which 
the  entire  insurance  world,  and  much  of  the  public,  are  interested. 

And  we  feel  confident  at  this  time,  when  the  final  results  of 
these  five  years'  work  of  the  writer  are  being  put  into  your  hands, 
that  you  will  pardon  the  suggestions  which  sincerely  aim  to  trans- 
fer to  you  an  understanding  of  at  least  one  of  the  principal  pur- 
poses which  the  National  Council  can  serve. 

This  purpose,  we  realize,  will  be  largely  carried  out  in  the  pub- 
lication and  distribution  of  these  papers  so  as  to  reach  the  entire 
insurance  world,  but  we  do  feel  that  our  responsibility  would  not 
be  entirely  discharged  if  we  did  not  ask  each  of  the  Committee  to 
thoughtfully  read  these  papers  with  the  understanding,  which  we 
feel  sure  you  will  gather,  that  the  leading  insurance  men  are  now 
both  willing  and  anxious  to  write  and  read  along  the  trend  of 
thought  which  the  papers  direct,  while  five  years  ago  practically 
no  one  was  interested  in  the  subject  of  the  service  of  insurance 
in  its  collective  form. 

All  of  this  makes  it  seem  clear  to  the  writer  that  after  the  pub- 
lication and  wide  distribution  of  these  papers,  a  bureau  of  some 
description  should  exist  which,  after  carefully  familiarizing  itself 
with  the  gradual  growth  of  this  work,  would  aim  to  constantly 
carry  it  forward  by  procuring  from  competent  writers  a  constant 
broadening  of  this  educational  campaign,  at  least  among  insurance 
men  themselves,  of  the  service  being  performed  by  all  branches. 

Another  suggestion  which  the  writer  trusts  you  will  pardon,  and 
which  is  the  result  of  his  becoming  deeply  impressed  with  the  pro- 
found interest  taken  by  two  individuals  officially  connected  with 
the  Congress,  but  whose  association  in  the  National  Council  was 
of  such  a  character  as  not  to  permit  of  the  Executive  Committee 
appointing  them  to  your  body  under  the  rules  laid  down  by  the 
tentative  plan  of  organization,  but  who  we  believe  would  serve 
with  you  in  an  advisory  capacity  if  requested.  One  of  those  indi- 
viduals is  Mr.  Arthur  I.  Vorys,  who  acted  as  General  Chairman 
and  heard  practically  every  paper  read  during  the  Congress,  and 
who  gave  an  amount  of  thought  and  consideration  to  the  future 
possibilities  of  the  work  that  would  make  it  seem  quite  logical  that 
he  would  be  willing  to  further  serve  an  undertaking  to  which  he 
gave  so  much  thought  and  time.  The  second  party  in  mind  is 
Dr.  Frederick  L.  Hoffman,  whose  life  work  along  similar  lines 
doubtlessly  in  a  measure  accounts  for  the  ready  grasp  and  under- 
standing of  the  future  possibilities  of  this  work.  Moreover,  he  has 
been  in  San  Francisco  during  a  big  portion  of  the  Exposition  year, 


518  WORLD'S  INSURANCE  CONGRESS 

and  has  watched  this  work  closely,  and  the  paper  which  he  de- 
livered on  Life  Conservation  Day — October  12 — on  the  Exposition 
Grounds,  impressed  the  writer  as  one  that  could  well  be  considered 
a  summing  up  of  much  that  has  been  aimed  at  and  accomplished 
to  date;  and  it  does  seem  that  any  committee  in  this  work  could 
profit  by  the  advice  and  assistance  of  Dr.  Hoffman. 

With  the  exception  of  transmitting  to  your  Committee  the  com- 
pleted papers,  this  will  probably  be  the  end  of  the  writer's  con- 
nection with  this  work,  to  which  he  has  given  the  best  of  his 
thought  for  five  years;  and  the  suggestions  which  he  has  added 
to  this  communication  are,  be  assured,  with  the  single  purpose 
of  its  leaving  our  hands  with  the  best  which  we  can  contribute 
for  its  future  success. 

Yours  very  truly, 

(Signed)     W.  L.  Hathaway, 

Commissioner. 

The  second  letter,  dated  November  18th,  1915,  conveyed  a  sug- 
gestion which  appealed  strongly  to  the  mind  of  Mr.  Hathaway. 
It  was  as  follows : 

Reading  the  invitation  on  the  program  of  the  annual  meeting 
to  the  Association  of  Life  Insurance  Presidents  to  be  held  in  New 
York,  December  9th  and  10th,  suggests  to  me  a  course  which  your 
committee  might  find  it  advisable  to  pursue,  in  order  to  make 
known  to  the  entire  membership  of  the  various  associations  the 
aims,  purposes  and  future  value  of  the  National  Insurance  Coun- 
cil, namely : 

To  cause  to  have  a  well  informed  speaker  of  your  committee 
on  the  program  of  the  annual  meeting  of  every  association  during 
the  coming  year,  beginning  with  the  above  mentioned  meeting,  to 
tell  them  what  has  been  accomplished  to  date  and  the  collective 
benefits  which  will  accrue  through  the  National  Insurance  Council. 

This  would  serve  the  double  purpose  of  educating  the  members 
of  the  various  associations  through  their  proceedings  and  furnish- 
ing publicity  upon  the  subject  for  the  insurance  press. 

The  third  and  final  letter,  dated  November  22nd,  only  preceded 
by  a  few  days  the  forwarding  of  this  matter,  and  served  to  call 
to  the  notice  of  the  Committee  certain  observations  which  could  in 
no  other  way  be  properly  expressed.  The  letter  is  quoted  here- 
with : 

In  keeping  with  the  following  quotation : 

"The  Central  Committee,  being  authorized  by  the  Ex- 
ecutive Committee  of  the  World's  Insurance  Congress, 
shall  take  entire  charge  of  the  editing,  publi.shing  and  dis- 
tribution, by  sale,  or  otherwise,  of  the  proceedings  of  the 
Congress  and  other  insurance  events  of  the  Exposition," 

which  is  the  ninth  article  of  the  Tentative  Plan  of  Organization 
for  a  National  Insurance  Council,  unanimously  adopted  by  the 


WORLD'S  INSURANCE  CONGRESS       519 

National  Council  of  the  World's  Insurance  Congress  at  its  meet- 
ing on  October  9tli,  I  have  now  completed  in  typewritten  form 
all  of  the  history  and  papers  of  the  Exposition  insurance  events 
which  terminated  with  the  Congress,  and  have  had  tiiem  bound 
in  two  volumes,  which  will  be  forwarded  in  a  few  days  to  your 
Chairman,  Mr.  Charles  H.  Holland.  I  shall  send  him,  for  the 
use  of  your  Committee  in  editing  for  publication,  three  sets  of 
the  papers,  including  the  originals  as  far  as  it  has  been  possible 
for  us  to  procure  them. 

We  believe  that  these  papers,  in  the  form  presented,  will  read- 
ily lend  themselves  to  the  understanding  of  whoever  may  be  desig- 
nated to  make  the  final  edit. 

I  would  like  further  to  suggest  that  I  believe  your  Committee 
would  be  greatly  assisted  in  carrying  out  this  part  of  the  work 
if  they  had  a  complete  file  of  The  Daily  Field,  which  was  pub- 
lished here  for  six  months  this  year  during  these  events.  For 
the  purpose,  I  have  asked  Mr.  C,  I.  Hitchcock,  President  of  the 
Insurance  Field  Company,  to  send  your  Chairman  a  set  of  these 
papers,  which  he  has  readily  consented  to  do. 

In  reviewing  the  papers  that  have  been  prepared  by  you,  I 
find  that  they  do  not  reflect  a  full  understanding  of  what  has 
been  contributed  to  the  success  of  this  undertaking  by  the  Insur- 
ance Field  Company,  both  in  publishing  a  daily  paper  here  during 
the  period  mentioned ;  and,  what  is  perhaps  more  important  still, 
making  it  possible  for  us  to  have  the  personal  assistance  and  sup- 
port of  their  president,  Mr.  C.  I.  Hitchcock,  for  while  the  work 
performed  by  The  Daily  Field  as  a  publication  stands  for  itself 
with  a  creditable  understanding  in  the  minds  of  all  insurance  men 
who  follow  events,  it  remains  a  fact  that  no  one  but  myself  can 
fully  understand  the  extent  to  which  Mr.  Hitchcock  personally 
(outside  of  publishing  The  Daily  Field)  contributed  to  the  success 
of  the  events,  especially  the  Congress.  This  letter  scarcely  offers 
the  opportunity  for  an  adequate  expression  of  what  his  services 
really  were,  but  I  do  feel  that  I  would  be  remiss,  not  only  in  the 
opportunity  to  pay  a  just  tribute  but  in  giving  your  Committee  a 
proper  idea  of  the  value  which  Mr.  Hitchcock's  services  and  advice 
might  in  the  future  be  to  you  if  you  could  enlist  his  interest,  if  I 
failed  to  here  give  some  testimony  as  to  the  extent  of  his  contribu- 
tion in  carrying  out  many  of  the  ideas  for  which  your  committee 
has  so  liberally  commended  me  in  the  set  of  resolutions  drawn  by 
Mr.  Vorys.  It  makes  me  sincerely  wish  that  I  was  possessed  of  Mr. 
Vorys'  concentrated  power  of  expression,  that  I  might  in  a  few 
words  tell  of  the  sacrifices,  the  time  spent,  nights  as  well  as  days, 
by  My.  Hitchcock,  in  which  his  keen  intellect  and  extensive  infor- 
mation regarding  insurance  men  and  affairs  contributed  in  ways 
that  never  can  be  measured  to  whatever  success  has  been  achieved. 

In  saying  the  above,  I  do  not  wish  it  to  be  construed  that  I  lack 
a  keen  appreciation  of  the  work  performed  by  the  other  members 
of  the  Executive  Committee. 

I  have  always  had  the  loyal  support  of  ]\Ir.  William  J.  Button, 
its  chairman — a  gentleman  w^hose  standing  and  integrity  are  of 
such  high  character  that  if  he  had  performed  no  other  service  than 
the  loaning  of  his  name  and  the  guaranty  of  his  confidence  thus 


520       WORLD'S  INSURANCE  CONGRESS 

expressed,  he  would  have  performed  a  distinct  service  difficult  to 
otherwise  obtain. 

Mr.  George  I.  Cochran,  President  of  the  Pacific  Mutual  Life,  has 
repeatedly,  both  in  his  own  behalf  and  that  of  his  Company,  made 
sacrifices  and  given  support  which  would  justify  special  mention. 

Mr.  Willard  Done,  coming  to  his  appointment  in  the  Commis- 
sion fresh  from  the  Insurance  Commissionership  of  the  State  of 
Utah,  brought  to  the  work  a  fund  of  valuable  information.  ]\Iore- 
over,  he  gave  to  it  the  best  of  himself  as  a  man.  With  his  ability 
as  a  speaker,  he  constantly  contributed  much  to  the  success  of 
many  events. 

Your  present  Chairman,  Mr.  Charles  H.  Holland,  while  acting 
for  us  at  long  distance,  nevertheless  gave  us  his  support  and 
advice,  which  makes  his  services  an  important  contribution. 

So  as  a  whole,  I  w-as  more  fortunate  in  having  an  Executive 
Committee  whose  loyalty  and  support  were  never  lacking  in  any 
conceivable  way,  when  any  one  of  them  was  called  upon. 

Perhaps  in  no  other  way  could  the  caliber  of  the  men  be  under- 
stood better  than  by  the  liberality  which  they  have  shown  on  the 
completion  of  the  work  in  heaping  upon  me  compliments  and  cred- 
its in  which  they  should  so  justly  share  a  big  part. 

The  mention  of  one  more  personality  of  which  the  history  and 
papers  reflect  no  part  of  the  years  of  his  work  and  devotion,  is 
that  of  Mr.  Garner  Curran,  my  Deputy  Commissioner  and  Sec- 
retary of  the  Executive  Committee.  He  has  occupied  a  most  diffi- 
cult position.  He  has  been  loyal  and  conscientious,  and  labored  in 
a  way  which  financial  remuneration  alone  could  in  no  measure 
account  for;  and  it  is  a  great  pleasure  to  me  to  give  this  brief 
testimonial  to  my  knowledge  of  the  fact  that  he  also  has  contrib- 
uted much  for  which  he  is  justly  entitled  to  a  large  share  of 
thanks  and  appreciation  from  all  those  who  believe  that  good  has 
been  accomplished.  Perhaps  you  can  best  measure  my  apprecia- 
tion of  the  man  as  a  valuable  connection  w^hen  I  say  that  it  is  my 
effort  to  keep  him  permanently  connected  with  me  as  a  business 
associate. 

Very  truly  yours, 

(Signed)     W.  L.  Hathaway, 

Commissioner. 

III.     INSURANCE  EVENTS  AND  EXHIBITS 

AT  THE 

PANAMA-PACIFIC   INTERNATIONAL   EXPOSITION 

The  most  valuable  opportunity  ever  offered  insurance  to  exploit 
its  broad  social  and  economic  service  through  direct  contact  with 
the  public  was  that  afforded  by  the  Panama-Pacific  International 
Exposition  in  fostering  special  insurance  events  under  the  auspices 
of  its  Insurance  Commission.  This  object  was  attained  by  the 
holding  of  insurance  gatherings  in  San  Francisco  and  the  assign- 
ment of  special  days  in  the  exposition  life  upon  which  the  larger 
interests  could  hold  public  demonstrations  or  exercises  explanatory 
of  the  work  of  those  particular  interests. 


AYORLD'S  INSURANCE  CONGRESS  521 

FIRE  PREVENTION  DAY— INSURANCE  DAY 

The  first  event  in  which  Insurance  was  brought  before  the  pub- 
lic in  a  forceful  way  was  held  before  the  opening  of  the  Exposition 
itself,  and  was  heralded  by  proclamations  issued  by  the  Mayor  of 
San  Francisco  and  the  Governor  and  Insurance  Commissioner  of 
California.  Proclamations  were  also  issued  by  Governors  of  nine 
of  the  foremost  States  of  the  Nation,  and  Mayors  of  several  of  the 
large  cities. 

It  was  on  the  occasion  when  the  first  completed  building  of  the 
Exposition — Machinery  Hall — was  dedicated,  and  the  honor  of 
conducting  the  ceremonies  of  that  dedication  was  most  fittingly 
bestowed  upon  insurance  men,  in  recognition  of  the  part  which  In- 
surance plaj'^ed  in  making  possible  the  holding  of  the  world 's  great- 
est Exposition  in  San  Francisco.  The  events  of  the  day  were 
planned  to  bring  to  the  fore  the  wonderful  constructive  work  per- 
formed by  insurance  in  the  rebuilding  of  the  city  in  the  eight 
years  elapsed  since  the  great  disaster  of  1906;  and  through  the 
addresses  there  delivered,  and  the  publicity  resulting  from  them,  a 
broad  understanding  was  developed  in  the  minds  of  thousands  not 
onl}^  as  to  the  work  of  insurance  in  that  particular  achievement, 
but  as  to  the  part  which  it  necessarily  must  play  in  all  future 
events  of  similar  magnitude. 

The  official  proclamations  concerning  the  daj^,  a  list  of  the  speak- 
ers and  their  remarks,  follow: 

Executive  Department,  State  of  California 

PROCLAMATION 

I  hereby  commend  to  the  people  of  California  the  observance  of 
Saturday,  the  18th  day  of  April,  1914,  as  Fire  Prevention  Day. 

The  purpose  is  to  bring  about  united  effort  on  this  occasion  to 
minimize  the  dangers  of  fire.  I  wish  to  join  in  making  urgent  ap- 
peal to  all  citizens  to  lend  their  energetic  aid. 

In  recognition  of  the  part  insurance  companies  have  had  in  the 
rebuilding  of  San  Francisco,  plans  have  been  made  for  a  cele- 
bration on  Fire  Prevention  Day  at  the  Exposition  Grounds 
in  San  Francisco.  It  is  my  earnest  hope  that  adequate  expression 
will  be  given  at  that  time  to  the  confidence  and  good  will  so  splen- 
didly earned  by  those  companies  that  met  their  obligations  honor- 
ably and  courageously  in  the  hour  of  overwhelming  disaster. 

In  Witness  Whereof,  I  have  hereunto  set  my  hand  and  caused 
the  Great  Seal  of  the  State  of  California  to  be  affixed  this  27th 
day  of  March,  1914. 

Hiram  W.  Johnson, 
Governor. 
Attest: 

Frank  C.  Jordan, 

Secretary  of  State. 


522  WORLD'S  INSURANCE  CONGRESS 

PROCLAMATION 
By  James  Rolph,  Jr. 

Complying  with  the  request  of  many  citizens,  and  with  the  ap- 
proval of  the  Honorable  Board  of  Fire  Commissioners  of  this  city, 
I  hereby  proclaim  and  designate  April  eighteenth  "Fire  Preven- 
tion Day,"  in  and  for  the  City  and  County  of  San  Francisco. 

In  doing  so,  I  especially  request  that  all  owners  or  tenants  of 
houses  or  buildings,  of  whatever  kind,  within  the  city,  give  careful 
thought  on  that  day  to  the  possibility  of  fire  upon  their  premises, 
and  ask  that  they  carefully  inspect  their  own  homes  or  places  of 
business,  with  a  view  to  the  removal  of  any  unnecessary  inflam- 
mable material  which  may  be  found  needlessly  stored  or  carelessly 
left  about,  constituting  a  menace  to  property. 

Let  it  be  remembered  that  a  great  proportion  of  the  fires  occur- 
ring in  any  large  city  could,  by  forethought  and  attention,  be 
easily  prevented,  with  consequent  saving,  not  only  to  owners  of  the 
property  involved,  but  to  the  city  also,  as  each  response  to  an 
alarm  of  fire  means  a  considerable  epense  to  the  Fire  Department. 

With  these  facts  in  view,  and,  although  every  day  should  be  a 
fire  prevention  day,  I,  as  i\Iayor,  have  designated  the  anniversary 
of  the  great  fire  of  1906  especially  as  "Fire  Prevention  Day,"  in 
order  that  the  subject  of  fire  prevention  may,  at  that  time,  be 
given  general  public  attention. 

(Signed)     James  Rolph,  Jr. 
j\Iayor  of  the  City  and  County  of  San  Francisco. 

March  23rd,  1914. 

Insurance  Department 
OF  THE  State  of  California 

BULLETIN 

April  18th,  the  anniversary  of  the  great  conflagration  of  1906, 
has  been  designated  by  the  Hon.  Hiram  W.  Johnson,  Governor  of 
the  State  of  California,  as  a  day  to  be  commemorated  by  the  people 
of  this  State.  A  similar  proclamation  has  been  issued  by  the 
Mayor  of  the  City  of  San  Francisco  calling  upon  the  citizens  of 
the  municipality  to  participate  in  observing  this  day. 

In  furtherance  of  this  idea  and  to  give  it  concrete  expression 
President  Charles  C.  Moore  and  the  Directors  of  the  Panama- 
Pacific  International  Exposition  have  tendered  the  use  of  the  Ex- 
position Grounds  for  holding  appropriate  exercises  and  have  offi- 
cially designated  this  day  as  "Insurance  Day,"  in  honor  of  the 
great  part  insurance  played  in  the  rebuilding  and  recreation  of  the 
City  of  San  Francisco. 


WORLD'S  INSURANCE  CONGRESS       523 

In  accord  with  these  proclamations  and  the  great  honor  bestowed 
upon  the  insurance  fraternity  by  the  President  and  Directors  of 
the  Exposition,  I  ask  that  all  engaged  in  this  great  business  join 
in  this  celebration  and  by  active  participation  show  their  ap- 
preciation of  the  honor  conferred  upon  them. 

E.  C,  Cooper, 
Insurance  Commissioner. 
San  Francisco,  Cal. 
April  11,  1914. 


RESOLUTIONS 

Passed  by  Advertising  Association  of  San  Francisco 

AViiEREAS,  President  C.  C.  Moore  and  the  Panama-Pacific  Inter- 
national Exposition  officials  have  designated  April  18th  as  "In- 
surance Day,"  and  a  special  celebration  will  be  held  at  the  Ex- 
position grounds  on  that  day,  and 

Whereas,  Hon.  Hiram  AV.  Johnson,  Governor  of  California,  and 
Hon.  James  Rolph,  Jr.,  Mayor  of  San  Francisco,  have  issued 
proclamations  giving  official  recognition  to  this  day, 

Be  it  Therefore  Resolved,  That  the  Advertising  Association 
of  San  Francisco  does  heartily  endorse  the  movement  to  set  aside 
one  day  each  year  as  "Insurance  Day,"  and  we  suggest  that  it 
be  made  national  in  scope,  and  that  in  order  to  fittingly  express 
the  sentiment  on  this  subject  we  pledge  our  support  individually 
and  collectively  to  influence  a  large  attendance  and  enthusiasm  on 
this  April  18th,  1914. 

RESOLUTIONS 

Passed  by  Rotary  Club  of  San  Francisco 
April  7th,  1914 

Whereas,  The  President  and  Directors  of  the  Panama-Pacific 
International  Exposition  have  set  aside  April  18th,  1914,  as  Insur- 
ance Day  at  the  Exposition  Grounds;  and 

Whereas,  The  Governor  of  the  State  has  issued  a  proclamation 
commending  and  endorsing  this  action  and  calling  upon  the  people 
of  the  State  to  fittingly  commemorate  that  day ;  and 

Whereas,  The  Mayor  of  the  City  has  also  issued  a  proclama- 
tion calling  upon  the' people  of  this  City  also  fittingly  to  celebrate 
the  day;  and 

Whereas,  It  is  desirable  that  the  world  should  be  impressed  with 
the  fact  that  San  Francisco  has  been  so  reconstructed  as  to  enable 
them  to  give  a  great  Exposition, 

Be  it  Resolved,  That  it  is  the  sense  of  the  Rotary  Club  of  San 
Francisco  that  Insurance  Day,  April  18th,  1914,  should  be  given 
all  support  to  make  it  the  success  which  it  deserves. 


524  WORLD'S  INSURANCE  CONGRESS 


INTRODUCTORY  REMARKS 

By  W.  L.  Hathaway 

Commissioner,  World 's  Insurance  Congress  Events  of  the  Panama- 
Pacific  International  Exposition 

At  Insurance  Day  Exercises,  Machinery  Hall,  Saturday, 
April  18th,  1914 

"Insurance  Day,"  April  18,  1914,  has  a  special  significance  to 
this  gathering,  this  city  and  this  State,  as  it  will  be  for  all  time  an 
example  and  a  lesson  to  the  entire  world ;  for,  standing  here  to-day, 
the  first  big  public  gathering  in  the  first  completed  building  of 
the  greatest  International  Exhibit  that  the  world  has  known, 
erected  by  a  city  that  eight  years  ago  was  wiped  off  the  face  of  the 
map  as  far  as  its  material  constn^etiou  was  concerned,  it  is  well 
to  apply  the  principle  of  "render  unto  Cffisar  the  things  that  are 
Caesar's,  and  unto  God  the  things  that  are  God's;"  and,  while 
I  do  not  wish  in  the  slightest  to  detract  from  that  God-like  man- 
hood and  womanhood  that  showed  itself  in  this  city,  the  credit 
that  is  justly  theirs  for  the  heroic  part  they  played  throughout 
those  trying  days  and  the  years  that  have  succeeded  them,  still  it 
is  well  to-day  to  "render  unto  insurance  those  things  which  to 
insurance  belong;"  and  to  acknowledge  to  ourselves  and  to  the 
world  that  insurance  rebuilt  San  Francisco;  and  that  while  it 
rose,  Phoenix-like,  from  its  ashes,  it  rose  upon  a  foundation  the 
basic  system  of  which  is  applied  throughout  civilization;  and  that 
man's  trust  and  greatest  cooperative  system  was  proven  (in  the 
distributing  of  a  great  loss  to  rebuild  a  great  city),  over  the  face 
of  the  entire  world. 

San  Francisco  is  an  "insurance  city,"  rebuilt  by  insurance 
money,  life  as  well  as  fire,  and  we,  as  an  insurance  community 
assembled  here  to-day  fifteen  thousand  strong,  claim  it  as  our  ex- 
hibit at  the  Panama-Pacific  International  Exposition;  and  I  say 
to  you  insurance  men  gathered  here  to-day  that  if  you  do  not 
make  the  most  of  this  exhibit — if  you  do  not  from  this  time  out 
educate  the  entire  world  to  look  upon  this  city  as  the  insurancd 
exhibit — you  will  not  only  be  losing  an  opportunity,  but  you  will 
be  failing  in  your  duty  to  the  business  which  you  represent:  for 
it  is  your  duty  as  an  insurance  community  to  make  the  entire 
world  understand  that  the  insurance  exhibit  at  this  Exposition  ex- 
ceeds in  grandeur  and  accomplishment  all  other  exhibits  that  will 
be  here,  for  it  is,  remember,  the  entire  city  of  San  Francisco,  and 
incidentally  this  Exposition  itself,  which  is  the  outgrowth  of  the 
city  rebuilt  by  insurance  money. 

This  being  the  first  great  gathering  in  the  first  completed  build- 
ing of  the  greatest  Exposition  ever  given  by  a  Christian  nation, 


WORLD'S  INSURANCE  CONGRESS       525 

it  seems  well  that  we  should  acknowledge  whence  we  all  draw  our 
power  and  inspiration,  and  for  that  purpose  I  will  call  upon  the 
Rev.  F.  W.  Clanipett  for  an  invocation  of  blessings  upon  that 
which  is,  and  strength  to  carry  out  those  things  for  which  we  have 
planned  and  obligated  ourselves. 

[The  Rev.  Dr.  Clampett,  rector  of  Trinity  Episcopal  Church, 
then  delivered  in  his  usual  impressive  manner  an  invocation  ap- 
propriate to  the  occasion.] 


ADDRESS  6f  welcome 

By  C.  C.  Moore 
President,  Panama-Pacific  International  Exposition 

At  Insurance  Day  Exercises,  Saturday,  April  18,  1914 

Of  all  the  great  congresses  and  conventions  to  gather  on  these 
grounds,  and  to  date  there  are  two  hundred  and  twenty-five  of 
them,  the  first  of  them  all  to  organize  was  the  World's  Insurance 
Congress.  The  first  gathering  on  these  grounds,  to-day,  of  all  those 
conventions  is  again  those  forces  and  influences  connected  with  the 
World's  Insurance  Congress. 

It  is  my  hope  and  my  belief  that  of  all  those  great  organizations 
that  will  leave  their  marks  in  history — that  will  make  for  the 
credit  of  our  country  and  the  glory  of  our  Exposition,  there  are 
none  of  whom  I  expect  more  than  I  do  of  the  same  World's  Insur- 
ance Congress. 

Insurance  is  such  a  broad  subject — so  little  understood.  I 
might  well  say  to  you,  "What  a  mighty  book  it  would  take  to 
carry  what  the  average  man  does  not  know  about  insurance."  In 
our  ignorance  we  are  disposed  to  regard  these  men  as  those  who 
come  to  us  and  collect  money  for  services  unperformed.  We  re- 
gard them  in  a  sense,  too  many  of  us,  as  a  sort  of  social  parasite. 

I  wouldn't  say  that  my  viewpoints  were  extreme  as  that,  but 
I  must  confess  that  one  of  the  great  comforts  of  my  life  is  the 
fact  that  to  me  the  curtain  has  been  raised,  and  I  have  learned  to 
know  what  insurance  means  and  to  know  and  honor  insurance 
men;  and  to  come  to  realize  how  not  only  they  protect  the  mer- 
chant and  the  manufacturer,  but  further  how  they  provide  those 
material  needs  and  those  blessings  in  the  hour  of  suffering  and 
trouble. 

Therefore  I  say,  "Blessed  is  the  insurance  man,"  for  in  his 
operations  not  only  does  he  work  for  profit  to  himself,  but  to  the 
advantage  and  protection  of  the  insured. 

In  this  gathering  to-day,  as  will  be  in  the  World's  Insurance 
Congress,  I  take  it  that  all  insurance  activities  are  represented. 


526  WORLD'S  INSURANCE  CONGRESS 

Those  that  hear  me  will  refer  back  to  those  eventful  days  eight 
years  ago.  As  for  me,  as  a  citizen,  I  want  to  forget  the  disaster, 
and  remember  only  the  glory  of  1906,  That  is  the  thought  that 
should  take  hold  of  us.  We  were  tried  in  the  forces  of  the  ele- 
ments. We  could  not  have  made  such  men  of  ourselves,  nor  pre- 
sented such  a  picture  to  the  world  of  American  courage,  fortitude 
and  energy,  had  those  eventful  days  been  denied  to  us.  Therefore 
I  say  that  the  example  of  San  Francisco  will  be  an  inspiration  the 
world  over,  to  men  who  must  meet  the  forces  of  the  elements. 

If  the  Exposition  will  be  the  direct  or  indirect  means  of  having 
the  world  better  understands  the  forces,  the  influences,  the  benefits, 
the  public-spiritedness  that  are  involved  in  insurance  operations, 
the  Exposition  will  feel  that  that  alone  will  have  justified  all  its 
effort  here. 

In  closing  I  want  to  say  to  you  that  I  hope  you  will  realize 
the  world's  elect  will  come  here  in  1915 — the  best  from  all  cities 
and  all  countries — bringing  with  them  the  delegates  of  insurance 
activities  and  the  friends  of  insurance  men,  for  then  you  will 
hasten  to  organize  definitely,  along  a  line  of  receiving  these  people. 
The  individual's  efforts,  well  intentioned  as  they  may  be,  are  too 
often  misdirected. 

Therefore,  throughout  your  organizations  of  fire,  life,  marine 
and  other  heads,  set  to  work  to  have  your  first  district  organiza- 
tions lead  up  to  a  central  body  that  will  take  in  hand  the  work  of 
reception  and  entertainment  of  those  of  your  profession  who  come 
here. 

It  is  not  how  we  may  rival  the  great  Expositions  of  the  world. 
It  is  not  the  vastness  nor  the  splendor  of  our  exhibits  that  will 
count.  If  that  personal  element  is  lacking,  if  that  personal  token 
which  we  carry  long  after  the  objects  of  the  Exposition  is  for- 
gotten, then  the  insurance  men  of  San  Francisco  will  have  failed 
of  the  high  purpose  entrusted  to  them.  I  know  they  will  not 
fail,  and  therefore,  while  I  have  not  definitely  planned  the  future 
of  it,  I  feel  that  I  am  within  the  words  and  the  mind  of  your 
Commissioner  when  I  say  you  can  serve  the  Exposition  in  no  bet- 
ter way  than  by  immediately  organizing;  so  that  it  matters  not 
where  the  insurance  man  comes  from  nor  where  his  friends  come 
from,  just  so  they  will  meet  from  the  San  Francisco  insurance 
men  with  the  same  hospitality  and  the  same  hand  of  good  fellow- 
ship that  will  be  extended  to  those  who  come  from  other  avenues 
of  trade  and  commerce. 

Thrice  welcome,  therefore,  is  to-day,  the  beginning  of  the 
World's  Insurance  Congress  on  these  grounds.  Every  influence 
and  facility  of  the  Exposition  will  always  be  at  your  command, 
Gentlemen. 


WORLD'S  INSURANCE  CONGRESS  527 


ADDRESS  OF  WELCOME 

By  James  Rolph,  Jr. 
Mayor,  City  of  San  Francisco,  Cal. 

At  Insurance  Day  Exercises,  Saturday,  April  18,  1914 

We  are  gathered  here  this  afternoon  on  the  Exposition  grounds 
in  this  marvelous  Machinery  Hall,  called  together  by  Mr.  W.  L. 
Hathaway,  Commissioner  of  the  World's  Insurance  Congress 
Events  of  the  Exposition,  to  meet  the  insurance  men  of  the  State 
to  show  them  what  we  are  doing. 

Some  of  my  fellow  citizens  say,  ' '  Let  us  forget  eight  years  ago. ' ' 
But  I  say  it  is  well  worth  while  to  let  our  thoughts  wander  back 
to  April  18,  1906,  and  those  days  following  the  earthquake,  when 
San  Francisco  lay  in  ashes  and  when  the  fires  devastated  miles  of 
this  beautiful  city. 

Can  we  forget  the  pluck,  and  the  enterprise,  and  the  energy,  and 
the  optimism  of  the  men  of  those  days — the  spirit  that  came  down 
from  our  pioneer  fathers — making  it  possible  for  you  San  Francis- 
cans to  stand  here  to-day  in  this  marvelous  building  on  the  Expo- 
sition grounds  and  to  extend  a  welcome  to  the  insurance  men  of 
the  State  and  to  the  insurance  men  of  the  country? 

What  would  we  have  done  without  the  insurance  men  following 
that  great  catastrophe,  destroying,  as  it  did,  two  hundred-odd 
millions  of  dollars  of  property — money  repaid  to  us  by  insurance 
men,  and  with  which  we  have  rebuilt  this  great  city? 

I  do  believe  in  insurance.  I  believe  in  fire  insurance,  I  believe 
in  life  insurance,  I  believe  in  marine  insurance,  and  I  believe  in 
miscellaneous  insurance  in  all  its  branches;  and  you  can  count 
upon  me  as  a  booster  for  insurance,  an  advocate  of  insurance  and 
a  man  who  realizes  the  protection  it  affords  to  life  and  property, 
and  the  protection  of  the  home  and  the  family  within  the  home. 

I  was  happy  to  be  able,  as  the  Mayor  of  this  City,  to  issue  a 
proclamation  declaring  this  "Insurance  Day,"  making  the  people 
mindful  of  what  insurance  is,  giving  them  a  thought  for  the  future 
protection  of  the  home,  family,  business  and  all  that  can  be  insured. 

In  the  name  of  San  Francisco,  I  extend  to  you.  Gentlemen  of 
the  Insurance  World,  a  most  hearty  welcome. 

We  who  are  identified  with  the  Exposition  take  a  pride  in 
what  is  being  done  here.  We  are  proud  of  our  President.  When 
the  gates  swing  open,  on  time,  on  the  20th  of  February,  1915,  we 
will  meet  all  parts  of  the  world  right  here  on  this  very  ground. 
May  we  all  meet  next  year,  and  in  years  to  come,  in  this  great 
thriving  metropolis  of  the  Pacific,  in  which  we  are  all  interested. 
I  thank  you  for  being  in  San  Francisco  to-day.  San  Francisco 
extends  to  you  a  welcome  coming  from  the  bottom  of  her  heart. 


528  WORLD'S  INSURANCE  CONGRESS 


RESPONSE  TO  ADDRESS  OF  WELCOME 

By  Warren  R.  Porter 

In  Behalf  of  the  Commissioner  of  the  World's  Insurance  Congress 
Events,   Panama-Pacific  International   Exposition 

At  Insurance  Day  Exercises,  Saturday,  April  18,  1914 

The  task  of  arranging  this  great  celebration  having  fallen  upon 
Mr.  W.  L.  Hathaway,  the  Commissioner  for  the  World's  Insurance 
Congress,  places  the  responsibility  upon  me  of  acknowledging  the 
brilliant  address  of  welcome  to  which  we  have  just  listened.  This 
responsibility  is,  however,  coupled  with  the  opportunity  for  which 
I  have  long  sought  to  publicly  testify,  in  this  presence,  to  the 
courage,  persistence  and  energy  that  President  ]\Ioore  has  given 
to  this  vast  enterprise.  It  is  a  source  of  deep  gratification  to  me, 
who  have  played  a  small  role  in  the  public  life  of  his  native  State, 
to  stand  here  and  give  my  word  of  credit  to  the  man,  my  life-long 
friend,  who  more  than  any  other  has  brought  into  being  the  Alad- 
din palaces  that  surround  us.  Now  that  his  dream  of  a  few  years 
ago  is  coming  into  a  reality,  I  know  I  speak  for  all  within  the 
hearing  of  my  voice  when  I  say  to  him  with  a  heart  full  of 
gratitude,  "Well  done." 

Significant,  too,  has  been  the  role  of  the  man  for  whom  I  am 
spokesman.  I  cheerfully  embrace  this  opportunity  to  say  of  him 
those  things  that  the  entire  insurance  fraternity  feels  towards 
him  and  the  magnificent  idea  he  has  conceived.  In  1910  Mr. 
Hathaway  formed  the  idea  that  the  highest  and  noblest  insurance 
ideals  could  best  be  served  by  bringing  about  a  World  Congress. 
He  began  a  campaign,  almost  unassisted,  to  bring  about  such  a 
gathering  at  the  Exposition  to  be  held  here  next  year.  Since  that 
time  he  has  devoted  himself  to  this  plan  with  unselfish  energy. 
He  was  the  first  to  fully  grasp  the  tremendous  importance  of  insur- 
ance interests  in  world  affairs.  The  whole  scheme  of  insurance  is 
so  vast,  so  vital  and  so  fraught  with  significance  to  the  entire  social 
order,  that  the  bringing  together  of  all  these  interests  in  one 
congress  will  have  indeed  far-reaching  results.  Practically  all  in- 
surance companies  of  the  United  States,  whether  they  be  life  or 
accident,  fire  or  casualty,  have  been  converted  to  the  magnitude 
and  importance  of  the  insurance  congress,  and  finally  the  Exposi- 
tion directors  have  realized  the  epoch  in  the  world's  progress  to 
be  marked  by  the  Congress  which  will  be  held  on  this  site  in  Octo- 
ber of  next  year.  It  may  be  interesting  to  you  to  know  that 
this  is  the  first  time  in  the  history  of  expositions  that  the  insur- 
ance interests  have  been  accorded  the  importance  and  responsibil- 
ity of  a  commissioner. 

My  close  association  with  insurance  affairs  may  prompt  you  to 


WORLD'S  INSURANCE  CONGRESS       529 

think  that  my  enthusiasm  for  the  cause  has  outrun  my  judgment 
and  that  I  am  vastly  overstating  the  signitieance  of  the  World's 
Insurance  Congress.  I  do  not  wish  to  oppress  you  with  figures 
or  statistics,  but  it  is  proper  for  us  all  to  realize  that  the  amount 
of  money  pledged  for  compensation,  for  the  loss  of  human  life  and 
for  the  restoration  of  property  destroyed  by  fire  in  the  United 
States  reaches  such  vast  figures  that  the  trained  mind  can  hardly 
grasp  any  adequate  idea  of  their  real  proportions.  Do  you  real- 
ize that  in  these  United  States  alone,  more  than  one  thousand,  five 
hundred  million  dollars  are  paid  annually  for  all  kinds  of  insur- 
ance! It  becomes  apparent  at  once  that  the  bringing  together  of 
the  men  who  are  spinning  this  web  of  protection  around  the  social 
and  economic  affairs  of  the  world  is  an  achievement  which  not  only 
captivates  our  imagination,  but  will  inevitably  result  in  great 
progress  and  reforms. 

The  insurance  industry  has  been  going  through  a  constructive 
period  to  such  an  extent  that  until  now  all  thought  of  bringing  its 
diversified  interests  into  coordinate  action  has  been  practically  neg- 
lected. Within  the  last  decade  insurance  in  this  country  has  made 
tremendous  strides.  Without  detracting  from  the  valuable  assist- 
ance he  has  received  from  many  men  and  other  interests,  I  unhesi- 
tatingly give  to  Mr.  Hathaway  all  of  the  credit  for  this  Congress 
idea  and  its  promotion  to  date.  He  has  devoted  himself  to  this 
task  since  1910 ;  he  has  traveled  far  and  wide ;  he  has  attended  in- 
numerable insurance  conventions,  where  his  voice  preached  the 
doctrine  of  the  Panama-Pacific  International  Exposition  and  its 
world-wide  importance;  he  has  secured  definite  assurances  from 
more  than  forty  life  insurance  companies  alone  that  they  will 
hold  their  annual  meetings  for  1915  at  this  Exposition,  and  it  is 
now  estimated  that  the  Insurance  Congress  events  alone  will  bring 
to  the  Exposition  more  than  two  hundred  thousand  people.  It  is 
remarkable  that  this  first  great  Insurance  Congress  will  be  held  not 
only  at  a  world's  Exposition,  but  in  the  City  of  San  Francisco, 
for  the  most  stupendous  exhibit  ever  conceived  by  any  combination 
of  industries  will  be  the  exhibit  offered  by  the  insurance  world, 
namely,  the  great  City  of  San  Francisco  itself,  destroyed  eight 
years  ago,  and  to-day  built  stronger,  greater  and  bigger  by 
moneys  promptly  paid  by  insurance  companies.  This  western 
metropolis,  in  fact  the  Exposition  itself,  is  in  a  measure  an  insur- 
ance Exposition,  giving  indestructible  testimony  to  the  protection 
which  insurance  provides. 

Insurance  companies  more  than  any  other  institutions  control 
the  great  river  of  gold  that  is  constantly  streaming  through  the 
world's  commerce.  We  hope  through  the  Congress  of  next  year 
to  bring  about  the  advocacy  of  fair,  intelligent  and  protective 
legislation ;  we  expect  to  establish  the  coordination  of  the  various 
elements  in  the  insurance  world,  and  we  plan  to  establish  unified 
action  among  these  great  institutions  along  lines  that  will  make 
for  the  world's  social  and  material  benefit.     No  commercial  activ- 


530  WORLD'S  INSURANCE  CONGRESS 

ity  can  possibly  reach  the  fireside  with  such  telling  effect  upon  the 
future  growth  and  development  of  the  people  of  this  land  as  does 
the  institution  which  protects  the  home  against  calamity  or  loss. 
This  protection  must  be  accorded  fairly  to  the  insured  and  to  the 
insurer.  Both  must  work  hand  in  hand,  to  the  end  that  we  may 
accomplish  the  greatest  good  for  the  greatest  number. 

I  call  upon  the  insurance  men  of  California,  especially  those  of 
this  city,  to  recognize  the  importance  of  this  great  Congress ;  espe- 
cially, however,  to  remember  that  they  will  be  charged  with  the 
responsibility  of  being  hosts  to  the  insurance  world  in  1915.  The 
well-known  and  recognized  hospitality  of  the  city  by  the  Golden 
Gate  must  not  be  permitted  to  suffer  at  our  hands.  I  call  upon 
you,  therefore,  to  organize  at  once  and  to  build  energetically  and 
earnestly  and  faithfully,  so  that  we  may  creditably  fulfill  the  ob- 
ligations we  have  assumed. 

I  predict  that  the  World's  Insurance  Congress  will  be  one  of 
the  glorious  achievements  of  1915 ;  that  its  effect  upon  our  indus- 
trial and  economic  development  will  mark  an  epoch  in  the  prog- 
ress of  our  social  order,  and  I  bespeak  for  the  Congress  your  ear- 
nest and  enthusiastic  cooperation. 


ADDRESS 

By  Willard  Done 
Commissioner  of  Insurance,  State  of  Utah 

At  Insurance  Day  Exercises,  Saturday,  April  18,  1914 

It  is  both  a  pleasure  and  an  honor,  which  I  appreciate  more 
than  I  can  express,  to  be  invited  to  speak  on  this  momentous  oc- 
casion. It  affords  me  great  satisfaction  to  be  able  to  bring  you 
direct  from  their  meeting  in  Chicago,  greetings  and  best  wishes 
from  the  State  Insurance  Commissioners,  in  spring  convention 
assembled.  I  have  had  the  honor  of  presenting  San  Francisco's 
invitation  to  the  Commissioners  to  hold  their  annual  conventions 
here  in  1915 ;  and,  while  definite  action  cannot  be  taken  at  this 
time,  it  seems  to  be  the  consensus  of  opinion  that  San  Francisco 
will  be  chosen  as  next  year's  meeting  place. 

It  is  also  a  great  honor  for  me  to  bring  you  greetings  from  my 
own  State,  Utah,  and  Salt  Lake  City,  the  brilliant  gem  in  the 
midst  of  the  Rockies,  with  its  secure  and  rugged  setting  of  ma- 
jestic mountains,  rushing  rivulets,  salt  sea  and  verdant  valleys.  As 
I  was  glad  to  be  able  to  say  on  a  previous  occasion.  Salt  Lake 
and  Utah  stand  ready  to  furnish  a  half-way  house  of  hospitality, 
entertainment  and  refreshment  for  the  millions  who  we  hope  will 
be  San  Francisco's  guests  in  1915.  Especially  are  the  insurance 
companies  and  insurance  men  of  Utah  pledged  to  promote  in  every 


WORLD'S  INSURANCE  CONGRESS  531 

possible  way  the  success  of  the  World's  Insurance  Congress.  In 
my  own  capacity  as  State  Insurance  Commissioner,  and  speaking 
as  well  in  behalf  of  other  State  officials,  I  wish  you  every  success 
in  your  congress  and  in  your  Exposition,  which  mean  so  much  to 
us,  in  common  with  you. 

It  is  opportune  here  to  felicitate  the  State  of  California  and  the 
City  of  San  Francisco  on  the  splendid  enterprise  manifested  in 
the  preparations  for  this  Exposition,  which  promises  to  eclipse 
all  former  ones  in  completeness,  magnificence,  extent  and  mean- 
ing, and  to  be  the  last  word  in  historical  and  educational  exhibits, 
indeed,  it  will  be  worthy  of  the  event  it  celebrates,  the  greatest 
commercial  and  industrial  achievements  in  history,  the  completion 
of  the  Panama  Canal. 

What  I  have  seen  here  to-day  has  moved  me  deeply.  I  gaze  on 
the  magnificent  sweep  of  your  harbor — the  greatest  in  the  world; 
I  look  upon  the  incomparable  beauty  of  the  Golden  Gate,  open  for 
the  passage  of  richly  laden  vessels,  before  which  the  argosies  of 
old  sink  into  insignificance;  I  view  with  loving  admiration  the 
beautiful  park  adjacent,  taken  from  sea  and  sand  hill  and  made  a 
place  of  recreation  for  countless  millions;  I  contemplate  this 
queenly  City,  new  risen  from  the  fiery  ruins  of  eight  years  ago, 
and,  sitting  on  her  stately  hills,  ruling  a  province  greater  and 
richer  than  the  world  over  which  the  Eternal  City  bore  sway; 
and,  last  of  all,  I  see  the  beauty  already  apparent  in  these  Expo- 
sition grounds,  and  contemplate  the  splendor  and  magnificence 
they  will  display  when  the  Exposition  opens.  As  I  mark  these 
things,  I  feel  like  joining  with  you  in  the  chorus  of  your  Califor- 
nia song. 

I  stand  in  reverence  as  I  think  of  the  glorious  enterprise  and 
intrepid  courage  you  have  displayed.  Then  I  remember  that  only 
eight  years  ago  to-day  your  City  lay  in  ashes,  your  arteries  of 
trade  were  choked,  the  voice  of  industry  and  commerce  was  mute, 
and  the  pall  of  sorrow  and  loss  and  death  lay  over  this  splendid 
domain,  and  there  appeared  on  your  horizon  neither  hope  nor 
brightness,  but  only  the  darkness  of  grief  and  devastation.  And 
I  exclaim  with  awe,  ''What  hath  God  wrought,  by  the  God-like 
courage  of  men!"  Nor  do  I  forget  the  part  played  in  this  develop- 
ment by  the  great  institution  which  we  are  assembled  to  honor, 
the  admirable  constructive,  beneficent  system  of  insurance. 

For  if  men  and  women  have  been  the  instruments  of  this  recon- 
struction, insurance  has  been  the  means  by  which  this  modem 
miracle  has  been  wrought.  I  recall  that  almost  the  first  money 
available  in  the  stricken  city  was  that  furnished  as  policy  loans 
by  the  life  insurance  companies,  on  the  most  liberal  terms  and 
with  the  fewest  possible  restrictions.  I  also  remember  that  as 
soon  as  men  could  begin  to  think  and  act,  after  the  great  and 
paralyzing  calamity,  a  golden  stream  poured  into  the  city  from 
the  fire  insurance  companies,  continuing  until  millions  of  indem- 
nity Avas  paid  on  this  fire  alone.    Add  to  this  the  sums  insurance 


532  WORLD'S  INSURANCE  CONGRESS 

companies  have  paid  for  deaths  and  health  and  accident  claims 
arising  from  this  calamity,  and  you  will  realize  the  importance  of 
insurance  in  the  rebuilding  of  San  Francisco. 

There  have  been  in  history  other  reconstructed  cities.  Babylon 
was  restored  by  Nebuchadnezzar  to  such  splendor  that  he  stood 
upon  its  massive  walls  and  exclaimed  in  the  pride  of  his  heart, 
''Alone  I  did  it!"  Yet  because  he  had  ground  the  faces  of  the 
poor  and  failed  to  give  praise  where  praise  was  due,  he  was  forced 
to  wear  the  habit  and  eat  the  food  of  base  humiliation.  Nero  re- 
stored devastated  Rome  so  magnificently  that  he  could  boast,  "I 
found  the  city  of  mud  and  left  it  of  marble. ' '  Yet  here  again  the 
poor  man's  hut  was  removed,  that  the  rich  man's  palace  might 
take  its  place.     And  so  in  other  instances. 

But  in  the  building  of  your  City  there  has  been  no  such  dis- 
crimination. The  golden  stream  of  insurance  money  has  flowed 
as  readily  to  the  poor  as  to  the  rich,  and  the  cottage  of  the  one 
has  sprung  up  beside  the  palace  of  the  other.  So  that  both  can 
say  with  pride  and  gratitude,  but  not  with  arrogance,  "Our  City 
was  not,  but  now  it  is!" 

For  insurance  is  no  respecter  of  persons.  It  knows  no  dis- 
crimination between  rich  and  poor.  It  rebuilds  with  equal  alacrity 
the  marble  palace  and  the  lumber  cottage.  It  blesses  the  bereaved 
home  and  replaces  the  interrupted  income  of  the  poor  as  well  a& 
the  rich.  The  one  question  asked  is,  "Was  he  insured,  and  is  the 
claim  valid  ? ' '  Instances  are  common  where  beneficiaries  are 
sought  in  many  lands  for  years,  in  order  that  money  held  in  trust 
may  be  paid  to  them.  I  do  not  deny  that  you  of  San  Francisco 
found  a  few  exceptions  to  this  rule  of  strict  honesty.  But  there 
were  only  enough  exceptions  to  prove  the  general  rule.  And  when 
I  contrast  these  few  delinquent  companies  and  officials  with  the 
great  mass  of  companies  and  their  heads,  who  paid  to  claimants 
many  times  over  their  available  assets,  who  wrestled  for  months 
with  the  stupendous  problem,  who  yielded  not  an  inch  in  their 
determination  to  pay  the  uttermost  farthing,  whose  hair  was  whit- 
ened and  whose  forms  were  bowed  by  their  tremendous  task,  then 
I  gay  we  can  well  forget  the  few  who  were  recreant  in  our  admira- 
tion for  the  many  who  stood  the  test  and  fairly  met  the  issue. 

What,  then,  shall  we  say  of  the  splendid  system  of  beneficence 
and  finance  by  which  so  much  has  been  accomplished?  First  of 
all  I  think  it  is  most  fitting  that  through  the  enterprise  and  initia- 
tive of  your  Commissioner,  Mr.  W.  L.  Hathaway,  and  his  deputy 
and  the  other  militant,  aggressive  insurance  men  of  the  Pacific 
Coast  there  should  be  and  has  been  established  a  World's  Insur- 
ance Congress  in  connection  with  the  greatest  Exposition  in  the 
world's  history.  It  is  a  deserved  recognition  of  the  part  taken 
by  insurance  in  the  reconstruction  of  your  City  and  the  assistance 
it  has  rendered  and  still  may  render  in  making  your  great  Expo- 
sition a  success.  For  insurance  has  built  up  your  ruined  City, 
as  its  mission  is  to  restore  that  which  has  been  destroyed. 


WORLD'S  INSURANCE  CONGRESS       533 

It  reaches  into  every  avenue  of  public  and  private  life,  of  com- 
merce and  industry.  The  golden  stream  continually  flowing  in 
and  flowing  out  through  the  great  distributing  agencies  we  call 
insurance  companies,  replenishes  and  refreshes  wherever  it  goes. 
While  not  a  charity,  it  is  charitable;  while  not  a  pauperizing 
beneficence,  it  is  nevertheless  a  beneficence.  It  gives  assistance 
without  taking  away  self-respect;  it  restores  the  broken  family 
ties ;  it  replaces  the  wrecked  home ;  it  keeps  the  widowed  wife  and 
the  orphaned  children;  it  gives  new  courage  and  life  to  the  dis- 
couraged. All  of  this  it  does  because  of  the  work  of  the  conscien- 
tious, high-minded,  able  men  who  stand  as  its  representatives  to  the 
people.  And  this  tribute  I  pay  from  my  heart  to  insurance  com- 
panies and  to  the  men  who  represent  them. 

But  insurance  does  not  only  indemnify  for  losses  already  ac- 
crued. It  anticipates  and  discounts  losses  by  preventive  measures. 
In  the  last  few  years  there  has  developed  a  movement  for  publicity 
and  conservation  which  promises  splendid  results.  The  insurance 
companies  and  their  representatives  are  leading  this  movement. 
It  is  partly  selfish,  but  largely  humanitarian.  Realizing  that  every 
loss  is  absolute  and  that  insurance  simply  distributes  the  loss,  they 
have  concluded  that  as  far  as  possible  the  losses  must  be  prevented. 
To  this  ultimate  end  the  efforts  of  many  brainy  and  able  men  are 
directed,  and  the  work  is  attracting  more  such  men  every  day. 

While  the  calamity  which  destroyed  your  City  was  not  prevent- 
able, more  fires  and  accidents  and  many  deaths  can  and  should  be 
prevented.  The  needless  sacrifice  of  millions  of  property  and 
thousands  of  lives  annually  to  the  juggernaut  of  waste  and  care- 
lessness can  and  must  be  lessened  and  ultimately  wiped  out.  While 
the  task  is  Herculean  and  not  to  be  accomplished  to-day  or  to- 
morrow, yet  our  to-days  and  to-morrows  must  show  some  progress 
and  some  tangible  and  cumulative  results.  It  is  gratifying  that 
the  first  public  exercises  connected  with  your  insurance  congress 
are  given  over  so  largely  to  this  work  of  conservation.  Education 
and  conservation  may  well  be  made  the  slogan  of  this  congress. 

Again  I  say  it  is  most  fitting  that  such  a  congress  as  has  been 
established  here  should  be  established.  As  I  have  traveled  through 
different  parts  of  this  great  country  of  ours,  and  it  has  been  my 
privilege  to  visit  many  of  them  within  the  past  year,  this  idea 
everywhere  meets  with  enthusiasm.  Everv^where  I  go  the  great 
events  scheduled  for  the  world's  congress  in  1915  are  receiving 
universal  endorsement.  The  eyes  of  the  insurance  world  are  on 
San  Francisco,  as  also  are  the  eyes  of  the  industrial,  the  com- 
mercial, the  social  and  the  religious  world.  The  judgment  of  the 
world  will  be  passed  on  the  men  and  the  women  of  the  West  ac- 
cordingly as  they  measure  up  to  expectation.  But  such  is  the  con- 
fidence in  what  San  Francisco  is  and  what  San  Francisco  does, 
that  expectations  are  high.  They  are  justified,  and  I  know  they 
will  not  be   disappointed,   and   I   cannot   estimate,   nor  can   you 


534       WORLD'S  INSURANCE  CONGRESS 

measure,  the  benefit  to  the  great  institution  we  are  proud  to  rep- 
resent, which  will  come  from  the  work  you  are  doing. 

I  do  not  minimize  that  work.  I  know  that  those  engaged  in 
preparations  for  this  insurance  congress  will  need  all  the  assist- 
ance, all  the  enthusiasm,  all  the  material  help  that  can  come  to 
them.  And  I  am  safe  in  saying  that  this  help  is  coming  from  the 
outside  on  the  theory  that  not  only  God,  but  men,  helps  those 
who  help  themselves. 

I  think  that  practically  every  insurance  gathering  of  any  im- 
portance in  1915  will  take  place  in  San  Francisco.  I  am  glad  to 
know  that  already  there  have  been  set  in  motion  forces  prepara- 
tory' to  next  year's  insurance  day,  which  will  occur  a  year  from 
this  date,  that  the  Fire  Underwriters'  Association  of  the  Pacific, 
and  other  western  bodies,  will  be  here  during  the  three  days,  April 
19th,  20th  and  21st.  This  will  perhaps  be  the  first  great  gather- 
ing of  this  kind  in  your  city  in  connection  with  the  congress. 

I  know  that  you,  in  common  with  other  western  insurance  men, 
feel  your  responsibilities  to  the  rest  of  the  insurance  world;  that 
you  are  actively  engaged  in  preparation  for  the  magnificent  events 
scheduled  and  yet  to  be  scheduled  for  1915.  I  am  glad  to  know 
that  a  vast  number  of  agency  gatherings  will  be  held  here  during 
that  year,  and  that  practically  every  week  from  April  18th  to 
October  15th  there  will  be  one  or  more  insurance  conventions  in 
session  in  your  City.  The  eyes  of  the  insurance  world  are  upon 
you,  and  the  anticipations  raised  will  not  be  disappointed. 

To  you  San  Francisco  insurance  men  I  bear  this  message,  not 
only  from  my  own  State,  but  also  from  the  other  sections  of  the 
country  I  have  visited.  It  is  a  message  voiced  generally  by  in- 
surance men  and  insurance  organizations.  It  is  a  message  and  a 
pledge  to  which  you,  because  of  your  wonderful  enterprise  and 
initiative,  are  fully  entitled;  it  is  a  message  and  a  pledge  of 
which  I  am  both  pleased  and  proud  to  be  the  bearer.  In  my  own 
humble  language  it  is  this:  Greetings  and  good  will  from  all  sec- 
tions, from  all  bodies,  from  all  men  where  insurance  is  an  interest. 
All  good  wishes  to  the  State  of  California,  to  the  City  of  San 
Francisco,  to  the  men  and  women  who  have  made  and  will  make 
the  State  and  the  city  great ;  to  the  men  and  women  who  will  make 
the  Exposition  resplendent  with  glory,  honor  and  benefit;  and 
last,  though  by  no  means  least,  the  men  and  women  who  have  in- 
itiated and  will  build  the  first  universal  insurance  congress,  em- 
bracing all  insurance  thought  and  interest  and  purpose,  and  yet 
destroying  none  of  the  integral  forces  which  enter  into  insurance 
work  everywhere.  All  greetings  to  you  and  to  your  congress. 
Godspeed  and  success  in  the  work  that  you  are  doing.  For  you 
are  helping  to  demonstrate  the  fact  that  insurance  is  surely  com- 
ing into  its  own  in  the  public  estimation.  The  time  is  rapidly 
approaching  when  as  a  national  institution  it  will  be  known  nation- 
ally; when  it  will  be  universally  recognized  as  the  universal  sys- 
tem of  cooperation  and  mutual  helpfulness.     The  prejudices  it 


WORLD'S  INSURANCE  CONGRESS       535 

has  encountered  in  the  past  will  be  overcome  in  the  future.  It 
will  not  longer  be  used  as  the  football  of  politics,  the  means  by 
which  demagogues  gain  entry  to  public  place,  the  victim  of  their 
rapacious  exploitation.  No  longer  will  it  be  "Butchered  to  make 
a  grafters'  holiday." 

Education  and  enlightenment  insurance-wise  will  accomplish  the 
emancipation  of  the  people  and  their  system  of  cooperative  pro- 
tection, from  the  hands  of  those  who  see  in  it  only  a  means  of 
furthering  selfish  ends  and  dishonest  schemes.  For  when  the  pub- 
lic come  to  know,  as  they  will  know,  that  they  form  the  company 
and  prosper  as  it  prospers  and  suffer  as  it  suffers,  when  each  man 
realizes  that  he  is  taxed  when  the  company  is  taxed,  and  every 
man 's  loss  is  his  loss ;  then  the  people  will  arise  in  righteous  power 
and  demand  the  lightening  of  unjust  burdens  and  the  elimination 
of  preventable  losses. 

The  signs  of  the  times  all  point  that  way.  Three  days  ago,  at 
Chicago,  the  Insurance  Commissioners  unanimously  pledged  them- 
selves to  the  propaganda  of  education  and  conservation  in  their 
several  States.  They  agreed  to  be  a  means  of  communication  be- 
tween the  publicity  bureaus  of  insurance  organizations  and  the 
people,  for  education  and  conservation.  And  no  matter  if  it  takes 
a  generation  or  several  generations,  this  plan  of  enlightenment 
will  be  carried  through  until  men  will  be  protected  from  unsound 
schemes  and  gross  exactions,  because  they  who  understand  correct 
principles  can  best  govern  and  protect  themselves. 

Insurance  asks  no  special  or  unwarranted  favors  from  State  or 
Nation.  Insurance  men  ask  no  unfair  exemptions.  But  since,  like 
fabled  Atlas,  it  bears  the  world  of  financial  loss  on  its  shoulders, 
it  does  ask  that  no  unjust  burdens  be  added,  and  in  return  for 
simple  justice,  insurance  and  insurance  pledge  themselves,  their 
ability  and  their  integrity  to  alleviating  suffering;  distributing 
among  the  many  their  losses  of  the  few;  building  up  devastated 
cities;  restoring  ruined  homes;  binding  together  broken  families; 
realizing  more  fully  and  better  in  their  work  than  it  can  be  real- 
ized by  any  other  financial  and  fiduciary  system,  the  universal  kin- 
ship of  humanity. 

If  the  question  is  asked,  "What  good  can  come  from  insur- 
ance?" San  Francisco  needs  only  to  answer,  "Come  and  see." 
The  world  will  come,  will  see,  will  be  convinced.  Insurance  will 
proclaim  through  these  visitors  to  all  their  towns  and  habitations, 
"What  I  have  done  for  San  Francisco,  I  will  do  for  you  if  need 
arises.  For,  when  it  comes  to  the  distribution  of  benefits,  I  know 
no  east,  no  west,  no  rich,  no  poor,  no  race,  no  creed,  no  age,  no  sex. 
To  all  who  deserve  my  ministrations  I  am  the  benefactor  of  hu- 
manity ! ' ' 

I  have  carried,  then,  in  rude  and  imperfect  form  the  message 
of  the  insurance  world  to  you  insurance  men.  I  have  formulated 
(imperfectly,  I  know)  your  message  to  the  Nation  and  the  world. 
And  if  there  shall  come  from  this  occasion  a  better  understanding 


536       WORLD'S  INSURANCE  CONGRESS 

and  a  closer  sympathy  between  a  beneficent  system  and  the  world 
it  benefits,  I  shall  be  more  than  repaid  for  the  effort  I  have  made  to 
visit  and  address  you. 


OTHER  INSURANCE  EVENTS,  1914-1915 

In  addition  to  the  program  of  addresses,  the  San  Francisco  and 
Exposition  Fire  Departments  gave  an  interesting  and  instructive 
demonstration  of  fire  prevention  and  fire  fighting  and  of  life  sav- 
ing work  as  practised  by  modern  city  departments. 

From  April  of  1914  to  April  of  1915  much  of  the  effort  of  the 
Insurance  Commission  was  directed  toward  the  securing  of  addi- 
tional conventions  and  meetings — a  work,  crowned  with  unusual 
success,  for  in  the  six  months'  period  of  the  insurance  events  of 
the  Exposition,  beginning  April  17th  and  ending  on  October  15th, 
1915,  scarcely  a  week  passed  but  what  one  or  more  conventions 
were  in  session. 

The  first  insurance  event  of  the  year  1915  w'as  in  fact  a  series 
of  events  of  itself,  and  was  known  as  the  "Nine  Years  After" 
celebration.  The  following  proclamations,  issued  by  the  I\Iayor 
of  San  Francisco  and  the  Governor  of  California,  publicly  an- 
nounced the  event: 

"NINE  YEARS  AFTER"  EVENT 

Court  of  the  Universe — Exposition  Grounds 
Saturday,  April  17th,  1915 

(Under  the  auspices  of  the  Commission  in  charge  of  the  World's 
Insurance  Congress  Events.) 

Proclamation  in  Re  "Nine  Years  After"  Celebration 

Issued  By  Hiram  W.  Johnson 

Governor,  State  of  California 

Executive  Department,  State  of  California 

PROCLAMATION 

In  compliance  with  numerous  requests  from  leaders  in  religious 
and  educational  work,  and  from  many  other  citizens  of  the  State, 
I  hereby  designate  Sunday,  April  18th,  1915,  the  ninth  anniver- 
sary of  San  Frajicisco's  destruction  by  the  elements,  as  a  day  for 
thanksgiving  services,  in  w^hich  a  grateful  people  may  give  a  re- 
newed expression  of  the  faith  that  triumphs  over  sweeping  disas- 
ter.   The  occasion  presents  the  example  of  the  accomplishment  of 


WORLD'S  INSURANCE  CONGRESS       537 

indomitable  perseverence  and  courage  of  a  great  people,  and  af- 
fords a  striking  contrast  between  the  achievement  of  peace  and 
the  consequences  of  war.  All  San  Franciscans,  indeed  every  citi- 
zen of  California,  may  proudly  and  gratefully  observe  the  day. 

Hiram  W.  Johnson. 


PROCLAMATION 
By  James  Rolph,  Jr. 

The  approaching  seventeenth  day  of  April  will  be  the  ninth 
anniversary  of  the  last  day  of  existence  of  much  of  the  material 
part  of  the  "Old  San  Francisco,"  the  foundation  of  which  was 
largely  laid  by  our  Argonaut  fathers,  whose  glorious  achievements 
in  winning  for  us  this  Western  Empire  endear  to  our  hearts  their 
memory,  and  the  city  they  builded. 

The  new  city  has  arisen  in  its  reconstructed  greatness  to  the 
proud  distinction  of  offering  to  the  world  its  greatest  Interna- 
tional Exposition,  at  a  time  when  the  dreams  and  ambitions  of 
those  Argonaut  fathers  are  being  realized  through  the  linking  of 
the  two  great  oceans,  whereby  the  commerce  of  the  world  is  brought 
to  our  doors.  We  therefore  deem  it  fitting  to  celebrate  appropri- 
ately the  17th  day  of  April  as  planned  under  the  auspices  of  the 
Panama-Pacific  International  Exposition — the  crowning  achieve- 
ment of  San  Francisco's  greatness. 

It  is  further  fitting  and  proper  that  the  succeeding  day,  April 
the  eighteenth,  be  dedicated  as  an  occasion  for  expressing  to 
Almighty  God  thanks  for  the  gifts  that  have  been,  with  such 
bounteous  hand,  showered  on  the  new  and  old  city.  This  thought 
is  suggested  by  the  following  set  of  resolutions  recently  adopted 
by  men  prominent  in  the  clerical  and  secular  activities  of  our  city 
and  State: 

"The  City  of  San  Francisco  w^as  visited  by  a  devastating  fire  on 
the  eighteenth  day  of  April,  1906,  the  destructive  character  of 
which  was  as  great  as  that  of  any  cataclysm  known  in  history. 

"During  the  past  nine  years  the  world  has  witnessed  the  rise 
of  San  Francisco  to  a  position  stronger  and  more  enduring  in 
every  respect  than  before  the  fire,  and  crowned  by  the  World's 
greatest  International  Exposition,  thus  presenting  in  concrete 
form  a  contrast  with  the  cities  of  the  Old  World  that  failed  to 
recover  from  the  catastrophes  that  visited  them. 

"The  City  of  San  Francisco,  built  on  this  western  outpost,  is  a 
geographical  center  with  a  growing  trade  between  the  Orient  and 
the  Occident,  and  stands  as  a  preeminent  illustration  of  what 
modern  civilization  may  achieve  through  avenues  of  peaceful  pur- 
suits, as  contrasted  with  periods  when  might  and  the  sword  pre- 
vailed. 


538  WORLD'S  INSURANCE  CONGRESS 

"And  furthermore,  from  a  careful  analysis  of  the  statistics  and 
facts  that  contributed  to  the  rehabilitation  of  this  city,  it  appears 
to  us  to  offer  the  most  striking  illustration  of  the  great  forces  that 
made  it  possible.  And  chief  amongst  such  forces  we  recognize  that 
throughout,  and  by  reason  of,  the  long  period  of  peace  enjoyed  by 
this  nation,  there  has  developed  a  cooperative  life,  in  which  the 
brotherhood  of  man  has  been  the  primal  factor.  Thus,  when  the 
city  suffered  in  the  destruction  of  property  to  the  extent  of  several 
hundred  million  dollars,  the  means  for  its  replacement  had  already 
been  provided  for,  through  that  cooperative  spirit,  known  as  'in- 
surance,' to  the  end  that  the  burden  of  this  city's  reconstruction 
fell  very  largely  and  evenly  through  that  part  of  the  civilized 
world  of  leading  commercial  activity.  Nor  does  the  fact  that  a 
commercial  spirit  entered  of  necessity  into  the  act  diminish  the 
force  of  the  altruistic  life  thus  presented. 

"Therefore,  in  recognition  of  the  above  facts,  and  the  lessons 
which  they  convey,  and  on  the  threshold  of  the  opening  of  the 
World's  International  Exposition,  which  stands  for  the  pursuits 
that  lead  to  the  world's  peace,  we  do  hereby 

"Resol\'E,  That  on  Sunday,  the  eighteenth  day  of  April,  1915, 
we  shall  commemorate  these  world-known  facts  by  services  of 
Thanksgiving  in  all  our  respective  places  of  worship,  with  ser- 
mons expressive  of  our  gratitude  to  Almighty  God  that  we  are 
privileged  to  live  in  a  land  and  in  a  community  where  the  victory 
of  the  pursuits  of  peace  has  been  so  strongly  demonstrated,  and 
that  in  addition  to  the  special  services  thus  to  be  held,  we  shall 
hold  a  Mass  Meeting  in  the  Municipal  Auditorium,  to  which  the 
entire  population  of  the  city  shall  be  invited  in  order  that  we  may, 
in  a  spirit  of  unity,  give  public  expression  to  our  appreciation  and 
thankfulness.    And  we  do  hereby  further 

' '  Resolve,  That  this  resolution  shall  be  given  to  the  press  of  this 
Nation  and  of  the  world,  with  the  desire  and  belief  that  all  people 
may  join  with  us  in  commemorating  a  course  of  events  which  offer 
the  strongest  foundation,  upon  which  an  appeal  may  reasonably 
be  based  for  the  peace  of  the  world." 

Now,  Therefore,  I,  James  Rolph,  Jr.,  Mayor  of  the  City  and 
County  of  San  Francisco,  do  hereby  proclaim  that  Sunday,  the 
eighteenth  day  of  April,  1915,  is  set  aside  as  a  day  for  public 
Thanksgiving  in  our  city,  in  keeping  with  the  above  set  of  reso- 
lutions; and  urge  all  loyal  citizens  of  San  Francisco  and  Cali- 
fornia to  participate  in  this  Thanksgiving  in  order  that  our  grati- 
tude to  Almighty  God  may  be  sincere  and  abiding;  and  that  all 
people  may  witness  that  during  this  period  of  pride  in  our  crown- 
ing achievements  this  great  metropolis  on  the  western  shores  of 
Occidental  civilization  is  glad  to  acknowledge  and  give  thanks  to 
that  source  from  which  all  strength  and  inspiration  spring. 

(Signed)     James  Rolph,  Jr., 

Mayor  of  the  City  and 
County  of  San  Francisco. 


WORLD'S  INSURANCE  CONGRESS       539 

On  the  first  two  days  of  the  celebration,  Saturday,  April  17th, 
and  Sunday,  April  18th,  practically  the  entire  City  of  San  Fran- 
cisco was  interested  in  the  proceedings.  Saturday  saw  a  monster 
military  and  civic  pageant  in  which  over  twenty  thousand  took 
part.  Nearly  four  hundred  automobiles  carrying  over  two  thou- 
sand insurance  people  were  in  line,  and  were  escorted  by  the  West- 
ern Division  of  the  United  States  Army  stationed  at  San  Fran- 
cisco. The  parade  was  headed  by  the  Mayor,  officials  and  directors 
of  the  Exposition,  Commissioner  W.  L.  Hathaway  and  the  com- 
mittee of  San  Francisco  insurance  men  who  assisted  in  making 
arrangements  for  the  day,  and  the  Hon.  Morgan  G,  Bulkeley,  who 
chanced  to  be  in  the  city  at  the  time.  It  started  from  the  Union 
Ferry  Depot  at  the  foot  of  Market  Street  and  took  its  way  through 
the  main  streets  of  San  Francisco,  finally  passing  before  a  review- 
ing stand  in  the  Exposition  Grounds,  where,  after  its  termination, 
brief  exercises  were  held  in  which  insurance  received  a  full  mea- 
sure of  recognition.     The  addresses  were  as  follows: 


CHAIRMAN  THORNWELL  MULLALLY,  INTRODUCING 

CHARLES   C.  MOORE 
President,  Panama-Pacific  International  Exposition 

This  celebration  of  the  ninth  anniversary  of  the  burning  of  San 
Francisco  is  fraught  with  sentiment  and  feeling  as  we  think  of 
the  past.  It  is  an  occasion  for  thanksgiving  as  we  look  upon  the 
present.  It  is  full  of  promise  as  we  face  the  future.  There  is 
love  for  the  old  City.  There  is  thanksgiving  for  the  new  and  the 
bigger  City.    There  is  certainty  for  the  future. 

We  would  not  be  celebrating  this  anniversary  of  the  burning  of 
San  Francisco  if  it  were  not  for  the  marvelous  reconstruction, 
better  than  before.  We  would  not  be  celebrating  it  were  it  not 
that  simultaneously  with  the  rebuilding  of  the  City  there  has  been 
built  here  this  great  Exposition. 

When  a  man  has  reached  a  high  pinnacle  of  greatness  he  may 
with  pride  look  back.  We  are  mindful  of  the  old.  We  remember 
our  City's  loss,  but  we  feel  that  out  of  the  destruction  there  has 
come  a  dawn  of  a  bigger,  higher  and  greater  life.  The  most  sadly 
impressive  sight  I  ever  saw  was  San  Francisco  burning.  The  most 
inspiring  impressive  sight  I  have  ever  seen  was  the  work  of  the 
men  of  San  Francisco  fighting  to  save  the  city;  and  when  their 
properties  had  been  destroyed,  returning  to  rebuild — better  than 
][)efore — with  an  energy  and  a  courage  that  has  challenged  the  ad- 
miration of  the  world.  The  most  beautifully  inspiring  sight  I  have 
ever  seen  was  this  great  Exposition,  created  within  the  city  limits, 
in  the  period  of  the  reconstruction  of  the  City  itself.  Downtown 
there  will  remain,  as  a  part  of  this  Exposition   a  monument  to  the 


540  WORLD'S  INSURANCE  CONGRESS 

energy  and  courage  of  the  people  of  this  generation — a  two  million 
and  a  quarter  dollar  Municipal  Auditorium. 

There  is  here  to-day  our  leader  in  the  work  of  creating  this  great 
Exposition — the  one  who  has  led  us  through  the  stress  and  strain 
of  Its  building.  He  has  given  of  his  time  and  of  his  resources — 
yes,  and  of  himself,  for  the  trial  has  been  great :  Mr.  Charles  C. 
Moore. 

ADDRESS 

By  Charles  C.  Moore 
President,  Panama-Pacific  International  Exposition 

Some  way  to-day  seems  to  me  to  be  one  calling  on  the  emotions. 
I  feel,  as  I  am  sure  you  all  do,  that  this  day  and  hour  brings 
forth  thankfulness  rather  than  vainglory.  Nine  years  ago  to-mor- 
row there  occurred — but  let's  forget  the  incident.  Remember  only 
the  sentiment,  the  love,  the  humanity  of  it  all.  I  scarcely  know 
what  to  say  that  is  appropriate.  It  makes  it  seem  difficult  to  put 
in  words  what  we  feel.  Your  presence  here  this  morning — this 
great,  splendid  turnout,  can  best  be  understood  without  transla- 
tion. It  is  a  splendid  thing — this  "Nine  Years  After''  celebra- 
tion; splendid  in  its  riches  of  memory — the  thoughts,  kindnesses, 
assistances,  cheer. 

Seeing  the  military  here,  I  feel  as  you  all  do  that  it  is  not  in- 
appropriate for  a  word  of  acknowledgment  for  the  great  help  they 
rendered  on  those  memorable  nine  years  ago.  All  of  us  of  the 
Exposition  are  of  one  thought,  one  feeling,  one  spirit  on  that 
service. 

On  this  occasion  of  the  "Nine  Years  After"  celebration — the 
day  of  the  insurance  men — the  beginning  of  their  great  week,  it 
is  probably  very  proper  that  we  should  recognize  them  with  words 
of  thanksgiving  and  appreciation.  Some  may  say  that  for  years 
they  stood  ready  to  meet  such  an  event.  But  no,  indeed!  They 
couldn't  have  looked  forward  in  anticipation  to  such  a  crushing, 
overwhelming  thing,  and  the  splendid  way  the  insurance  compa- 
nies, as  a  rule,  came  forward,  sustained  us,  carried  out  tlieir  obli- 
gations, made  possible  this  great  work.  So  there  is  due  to  them 
a  word  of  acknowledgment. 

There  is  also  due  them  a  word  for  the  splendid  commission  of 
insurance  men  that  have  taken  us  at  our  word  to  recognize  the 
insurance  interests,  that  have,  by  their  wonderful  ability  and 
enterprise,  brought  to  this  new  educational  center  nearly  one  hun- 
dred and  fifty  congresses  during  the  days  of  the  Exposition. 

I  would  be  remiss,  it  seems  to  me,  if  I  did  not  make  definite  and 
formal  acknowledgment  to  W.  L.  Hathaway,  the  Commissioner  of 
the  World's  Insurance  Congress,  and  those  splendid  men  associ- 
ated with  him,  and  the  insurance  men — here  and  elsewhere — that 


WORLD'S  INSURANCE  CONGRESS       541 

have  done  so  much  for,  and  glorified  and  aided  the  Exposition. 
I  feel,  as  I  know  you  do,  that  they  will  glorify  and  aid  the  insur- 
ance world  in  letting  us  all,  as  laymen,  better  understand  what 
their  aims  and  high  purposes  are.  Mr.  Chairman,  there  is  nothing 
else  I  have  to  say  except  to  congratulate  you.  There  has  been 
drawn  here  not  merely  the  numbers,  but  the  spirit  that  counts. 

Welcome  to  the  Exposition!  It  is  yours!  Bear  in  mind  there 
were  many  forces,  many  agencies,  employed  in  its  creation,  and 
among  them  insurance  must  necessarily  stand  well  to  the  fore. 


CHAIRMAN,  INTRODUCING  MORGAN  G.  BULKELEY 
President,  Aetna  Life  Insurance  Company 

These  ceremonies  grew  out  of  one  held  April  18th,  1914,  in  Ma- 
chinery Hall,  the  first  dedicated  building,  conducted  by  the  in- 
surance men.  The  Exposition,  in  recognition  of  all  the  insurance 
people  had  done,  turned  over  to  them  that  ceremony.  One  of  the 
exhibits  which  they  offered  at  that  time  to  show  what  insurance 
had  done,  was  the  City  of  San  Francisco,  and  really  they  had  a 
right  to  do  so.  One  of  the  floats  of  to-day  bore  the  inscription — • 
"Insurance  stood  between  San  Francisco  and  bankruptcy."  Cer- 
tain it  is  that  out  of  the  insurance  money  San  Francisco  was 
largely  rebuilded.  It  would  be  sad  indeed  to  contemplate  our 
position  had  it  not  been  for  insurance.  We  want  to-day,  as  far 
as  we  can,  to  give  recognition  to  insurance  and  to  insurance  men 
for  all  they  have  done  for  San  Francisco.  We  are  largely  in- 
debted to-day  for  this  ceremony  to  W.  L.  Hathaway,  Warren  R. 
Porter  and  William  J.  Dutton,  and  in  trying  to  show  them  recog- 
nition, we  have  again  become  indebted  to  them. 

There  is  here  to-day  a  distinguished  visitor.  He  stands  alone 
in  the  insurance  world.  He  represents  every  branch  of  the  busi- 
ness. He  is  a  man,  too,  prominent  in  public  life.  He  was  a 
United  States  Senator  three  times,  and  served  as  Governor  of 
Connecticut.  But  if  he  hadn't  done  anything  else,  his  coining  of 
one  phrase  would  have  won  for  him  undying  fame.  It  was  Mor- 
gan G.  Bulkeley  who  said — "The  Almighty  hates  a  quitter." 


ADDRESS 
By  Morgan  G.  Bulkeley 

I  recall  that  it  was  my  privilege  some  years  ago  to  give  to  the 
visitors  from  California  that  invaded  Washington  on  behalf  of 
this  City  my  support.  They  have  remembered  their  promises. 
This  Exposition  is  a  complete  justification  of  the  gentlemen  who 
participated  in  that  legislative  canvass — that  showing  made  by 
your  State  and  City  for  the  opportunity  to  demonstrate,  not  only 


542  AVORLD'S  INSURANCE  CONGRESS 

to  the  people  of  our  country,  but  to  the  people  of  the  world,  the 
complete  rehabilitation  of  San  Francisco, 

Now,  Mr.  President,  I  have  been  asked  to  speak  to-day  on  the 
great  interests  with  which  I  have  been  identified  the  greater  part 
of  my  life  (except  at  such  intervals  when  I  have  given  attention 
to  public  affairs),  and  to  which  you  so  gracefully  concede  are 
largely  due  the  achievements  of  this  City  of  San  Francisco  and  its 
Exposition.  I  look  with  an  eye  of  wonder  at  your  accomplishments 
in  the  past  nine  years.  You  are  a  model  for  the  world  for  your 
splendid  courage,  for  your  untiring  energy,  for  your  successful 
accomplishments,  for  the  rehabilitation  of  your  City  that  was  prac- 
tically in  a  day  utterly  destroyed. 

In  speaking  as  I  do  a  word  or  two  for  this  great  interest,  which 
I  regard  as  the  greatest  institution  of  all  times  for  the  distribution 
amongst  all  of  our  people  of  the  disasters,  the  misfortunes,  and 
the  woes  that  come  to  the  individual  few,  this  institution  which  I 
regard  onlj^  as  the  almoner  of  the  charities  of  people  to  each  other, 
and  the  means,  as  I  have  said  before,  of  a  distribution  of  the  mis- 
fortunes of  the  few  among  the  many,  I  may  say  that  it  is  the  ripe 
experience  of  the  managers  of  these  institutions  that  prepare  them 
to  meet  the  great  emergencies  of  disasters  which  come,  and  surely 
come,  as  we  have  seen  them  in  the  past,  and  as  they  will  surely 
come  in  the  future. 

The  great  contribution  of  the  class  of  institutions  which  I  rep- 
resent to  the  rehabilitation  of  your  City,  which  involved  the  largest 
destruction  of  property  by  the  fire  element  known  to  the  world, 
was  simply  the  gathering  in  from  the  people  of  their  yearly  con- 
tributions the  necessary  funds  with  which  to  redeem  their  obli- 
gations ;  and  when  they  paid  back  to  you,  as  they  did  readily  and 
liberally — yes,  almost  without  an  exception  redeeming  their  prom- 
ises, they  were  but  doing  gladly  the  work  which  you  entrusted  to 
their  charge.  When  these  great  institutions  returned  to  you,  not 
only  your  contributions  (which  were  but  a  drop  in  the  bucket), 
but  the  contributions  of  the  whole  country,  and  I  might  say  the 
whole  world,  they  performed  it  as  willingly  and  as  cheerfully  as 
they  ever  performed  any  business  transaction.  More  than  two 
hundred  million  dollars  was  turned  back  to  the  people  from  this 
fountain  which  they  had  filled;  and  there  were  a  lot  of  factors 
in  other  lines  of  the  insurance  business  than  that  of  fire  that  were 
helpful  at  least  in  furnishing  the  means  with  which  to  rebuild  on 
a  more  permanent  foundation  this  beautiful  City  we  look  upon 
to-day. 

ADDRESS 

By  Arthur  Arlett,  for  the  Governor  op  the  State  of 

California 

It  is  entirely  proper  that  a  word  from  our  commonwealth  to 
your  great  City  should  be  said,  and  while  I  had  wished  that  my 


WORLD'S  INSURANCE  CONGRESS  543 

chief  could  be  here  in  person  to  give  recognition  to  the  great  forces 
which  have  made  this  celebration  possible,  still  I  am  glad  to  pre- 
sent to-day  his  respects  to  these  men  who  have  made  so  much  pos- 
sible in  past  years  through  their  great  institution,  and  to  those 
other  men  who,  laboring  here  with  a  task  almost  insuperable, 
brought  forth  this  great  Exposition  and  this  wonderful  City,  I 
am  glad  indeed  to  say  the  word  of  greeting  and  congratulation  on 
the  part  of  our  State. 

ADDRESS 

By  James  Rolph,  Jr. 
Mayor,  City  and  County  of  San  Francisco 

I  make  grateful  acknowledgment  in  the  name  of  the  City  of 
San  Francisco  to  our  guests  who  have  spoken  in  such  laudatory 
terms  of  our  City  and  her  deeds  since  she  has  arisen  from  the 
ashes.  It  is  good  to  be  here.  It  is  good  to  be  in  this  wonderful 
Exposition  City.  It  is  good  to  have  the  world  celebrating  with 
us  here.  It  is  good  to  have  our  guests  from  all  parts  of  the  coun- 
try with  us  on  this  occasion.  It  is  good  to  look  around  and  see 
our  rebuilt,  magnificent,  splendid  city. 

And  when  we  think  of  what  this  City  was  in  1906,  we  can  well 
come  out  here  this  afternoon  and  feel  proud  of  the  City  that  has 
risen,  as  San  Francisco  has,  by  the  spirit,  the  courage,  the  enter- 
prise, the  ambition  of  people  that  have  demonstrated  to  the  world 
that  they  can  overcome  all  obstacles. 

The  time  is  getting  late,  but  I  want  to  say,  in  San  Francisco's 
name,  that  we  shall  never  forget  the  prominent  part  that  the 
troops  played  in  saving  our  City.  Neither  shall  I  forget  the  prom- 
inent part  that  our  boys  in  blue,  the  San  Francisco  firemen,  played 
in  saving  the  City.  We  shall  never  forget  what  every  man  and 
every  woman  did  in  those  dark  days  to  save  the  City,  and  how 
after  three  tiresome,  hard-working  days  and  nights  the  fire  was 
stopped,  and  no  sooner  had  the  fire  been  stopped  than  San  Fran- 
cisco started  to  rebuild  again. 

Evidences  of  what  she  has  done  are  manifest  on  every  hand. 
We  are  glad  to  show  this  City  to  our  guests  from  all  over  the 
world.  We  are  glad  to  show  them  our  new  buildings,  our  new 
railroads,  our  new  shops  and  stores,  and  our  soon-to-be  completed 
new  City  Hall,  which  is  San  Francisco 's  home  typical  of  her  char- 
acter and  the  artistic  taste  of  the  citizens  of  this  City. 

I  therefore  say  that  it  is  good  to  be  here.  It  is  good  to  be  San 
Franciscans,  good  to  feel  that  we  have  taken  part  in  what  has 
transpired,  and  good  to  feel  that  our  City,  State,  and  the  coast 
are  going  on  by  leaps  and  bounds. 

And  it  is  good  to  feel  that  we  are  going  to  have  an  opportunity, 
not  only  of  playing  the  part  that  we  did  in  reconstructing  our 


544  WORLD'S  INSURANCE  CONGRESS 

City  after  disaster,  but  of  building  here  a  City  still  more  glor- 
ious than  that  which  was  before,  until  she  really  has  become  a 
great  World  City. 


"NINE  YEARS  AFTER"  THANKSGIVING  SERVICES 

Court  of  the  Universe — Exposition  Grounds 
Sunday,  April  18th,  1915 

(Under  the  auspices  of  the  Commission  in  charge  of  the  World's 
Insurance  Congress  Events.) 

On  Sunday,  April  18th,  Thanksgiving  services  were  held  in  the 
Court  of  the  Universe  on  the  Exposition  Grounds.  The  following 
resolutions  were  passed  by  the  leading  clergymen  and  educators 
of  California: 

RESOLUTIONS  PASSED  BY  THE  LEADING  CLERGYMEN 

AND  OTHERS  OF  SAN  FRANCISCO  IN  REGARD  TO 

THE  "NINE  YEARS  AFTER"  EVENT 

The  City  of  San  Francisco  was  visited  by  a  devastating  fire  on 
the  eighteenth  day  of  April,  1906,  the  destructive  character  of 
which  was  as  great  as  that  of  any  cataclysm  known  in  history. 

During  the  past  nine  years  the  world  has  witnessed  the  rise  of 
San  Francisco  to  a  position  stronger  and  more  enduring  in  every 
respect  than  before  the  fire,  and  crowned  by  the  World's  greatest 
International  Exposition,  thus  presenting  in  concrete  form  a  con- 
trast with  the  cities  of  the  Old  World  that  failed  to  recover  from 
the  catastrophes  that  visited  them. 

The  City  of  San  Francisco,  built  on  this  western  outpost,  is  a  geo- 
graphical center  with  a  growing  trade  between  the  Orient  and  the 
Occident,  and  stands  as  a  preeminent  illustration  of  what  modern 
civilization  may  achieve  through  avenues  of  peaceful  pursuits,  as 
contrasted  with  periods  when  might  and  the  sword  prevailed. 

And  furthermore,  from  a  careful  analysis  of  the  statistics  and 
facts  that  contributed  to  the  rehabilitation  of  this  city,  it  appears 
to  us  to  offer  the  most  striking  ilkvstration  of  the  great  forces  that 
made  it  possible.  And  chief  amongst  such  forces  we  recognize 
that  throughout,  and  by  reason  of,  the  long  period  of  peace  en- 
joyed by  this  Nation,  there  has  developed  a  cooperative  life,  in 
which  tiie  brotherhood  of  man  has  been  the  primal  factor.  Thus, 
when  the  city  suffered  in  the  destruction  of  property  to  the  extent 
of  several  hundred  million  dollars,  the  means  for  its  replacement 
had  already  been  provided  for  through  that  coperative  spirit 
knowni  as  "Insurance,"  to  the  end  that  the  burden  of  this  city's 
reconstruction  fell  very  largely  and  evenly  tlirough  that  part  of 
the  civilized  world  of  leading  counnercial  activity.     Nor  does  the 


WORLD'S  INSURANCE  CONGRESS       545 

fact  that  a  commercial  spirit  entered  of  necessity  into  the  act 
diminish  the  force  of  the  altruistic  life  thus  presented. 

Therefore,  in  recognition  of  the  above  facts,  and  the  lessons 
which  they  convey,  and  on  the  threshold  of  the  opening  of  the 
World's  International  Exposition,  which  stands  for  the  pursuits 
that  lead  to  the  world's  peace,  we  do  hereby 

Resolve,  That  on  Sunday,  the  eighteenth  day  of  April,  1915, 
we  shall  commemorate  these  world-known  facts  by  services  of 
Thanksgiving  in  all  our  respective  places  of  worship,  with  ser- 
mons expressive  of  our  gratitude  to  Almighty  God  that  we  are 
privileged  to  live  in  a  land  and  in  a  community  where  the  victory 
of  the  pursuits  of  peace  has  been  so  strongly  demonstrated,  and 
that  in  addition  to  the  special  services  thus  to  be  held,  we  shall 
hold  a  Mass  Meeting  in  the  Municipal  Auditorium,  to  which  the 
entire  population  of  the  city  shall  be  invited  in  order  that  we 
may,  in  a  spirit  of  unity,  give  public  expression  to  our  apprecia- 
tion and  thankfulness.    And  we  do  hereby  further 

Resolve,  That  this  resolution  shall  be  given  to  the  press  of  this 
Nation  and  of  the  world,  with  the  desire  and  belief  that  all  people 
may  join  wnth  us  in  commemorating  a  course  of  events  which  offer 
the  strongest  foundation,  upon  which  an  appeal  may  reasonably 
be  based  for  the  peace  of  the  world. 

Edward  J.  Hanna, 

Bishop  of  San  Francisco. 

Edwin  H.  Hughes,  D.  D., 
Bishop  of  M.  E.  Church. 

James  Rolph,  Jr., 

Mayor  of  San  Francisco. 

David  Starr  Jordan, 

Chancellor,  Stanford  University. 

Martin  A.  Meyer, 

Rabbi,  Congregational  Emanu-El, 

William  Kirk  Guthrie, 

Minister  of  First  Presbyterian  Church. 

E.  R.  DiLLE,  D.  D., 
Pastor  M.  E.  Church. 

William  F.  Nichols, 
Bishop  of  California. 

Charles  C.  Moore, 

President,  Panama-Pacific  International  Exposition. 

Benj.  Ide  Wheeler, 

President  of  University  of  California. 

Robert  Newton  Lynch, 

Vice-President,  San  Francisco  Chamber  of  Commerce. 

Caleb  S.  S.  Dutton, 

Minister  of  the  First  Congregational  Church. 


546  WORLD'S  INSURANCE  CONGRESS 

H.  J.  McCoy, 

General  Secretary,  Y.  M.  C.  A. 

Frederick  W.  Clampett, 

Rector  of  Trinity  Episcopal  Church. 

The  speakers  of  the  day  responded  to  the  topic — "San  Fran- 
cisco— The  New  City,  Crowned  by  the  Exposition :  In  the  Triumph 
of  Peace  by  a  Cooperative  Spirit,  Through  the  Brotherhood  of 
Man."     The  full  program  of  addresses  is  given  herewith: 


INTRODUCTORY  ADDRESS 
By  Chairman  Frederick  W.  Clampett,  D.D. 

We  are  assembled  in  this  Court  of  the  Universe,  nine  years  after 
the  great  disaster,  to  offer  our  Thanksgiving  to  Almighty  God,  the 
Source  of  all  goodness  and  truth  and  love. 

This  day,  nine  years  ago,  the  hearts  of  the  men  and  women  of 
this  City  failed  them,  as  they  realized  the  terrible  nature  of  the 
forces  of  destruction  by  earthquake  and  fire. 

It  was  enough  to  try  the  stoutest  heart,  but  the  awful  test  was 
met  by  a  faith,  strong  and  enduring.  Out  of  that  chaos  of  .twisted 
steel  and  smouldering  ashes  a  new  San  Francisco  has  arisen.  It 
is  a  city  of  stronger  foundations,  of  vaster  area,  of  greater  beauty, 
of  more  enduring  type,  and  the  material  vision  has  been  crowned 
by  this  marvelous  world  Exposition,  which  tells  the  story  of  the 
glorious  achievements  of  art  and  science. 

But  this  material  strength  and  beauty  are  but  the  exponents  of 
the  unseen  forces  that  made  it  possible.  With  a  courage  that  de- 
fied every  obstacle  and  a  patience  that  won  the  admiration  of  the 
world  the  men  and  women  pressed  forward  in  the  work  of  recon- 
struction. 

This  truly  is  a  cause  for  the  deepest  thanksgiving,  and  yet  it 
does  not  complete  the  vision.  During  those  nine  years  there  has 
entered  into  the  life  of  the  community  a  larger  and  more  unselfish 
spirit.  The  problems  that  face  our  civic  life  are  met  by  a  spirit 
of  altruism  that  speaks  of  better  things. 

While  the  old  world  is  plunged  in  the  horrors  of  a  senseless 
war,  working  misery  and  death  and  every  form  of  human  suffer- 
ing, the  new  world  has  been  graciouslj^  privileged  to  engage  in 
the  glorious  pur.suits  of  peace. 

Conscious  of  these  great  blessings  we  are  here  assembled  on  this 
day  of  sacred  commemoration — in  the  beautiful  setting  of  this 
World's  Exposition,  to  express  our  heart-felt  thanks  to  God,  the 
Source  of  all  goodness. 


WORLD'S  INSURANCE  CONGRESS  547 


INVOCATION 

By  Right  Rev.  William  Ford  Nichols,  D.D. 
Bishop  of  California 

O  God,  Our  Heavenly  Father,  the  High  and  Mighty  Ruler  of 
the  Universe,  help  us  truly  to-day  to  enter  into  these  Exposition 
gates  with  thanksgiving  and  into  this  Court  with  praise.  After 
the  earthquake  was  the  fire  and  after  the  fire  Thy  still  small  voice 
to  call  us  to  a  better  civic  life  in  turning  to  Thy  Fatherhood  and 
in  quickening  our  sense  of  brotherhood  in  the  common  calamity. 
We  humbly  confess  to  Thee  our  shortcomings  in  all  these  nine 
years  since.  We  have  not  lived  up  to  the  hopes  and  visions  of 
those  sobering  days.  In  all  our  glow  of  civic  pride  we  cannot  shut 
our  eyes  to  the  neglect  of  Thy  worship,  the  absorptions  in  the 
uncertain  riches  and  vanities  of  this  present  world,  the  vices  that 
drag  men  and  women  down  to  crime  and  degradation,  our  sore 
spectacle  of  wrangling  municipal  strife,  and  whatever  else  hinders 
us  from  our  service  to  Thee  in  godly  union  and  concord.  If  we 
say  we  have  not  these  flagrant  ills  we  deceive  ourselves  and  the 
truth  is  not  in  us.  But  if  we  confess  them  we  know  that  Thou  art 
merciful  and  gracious  to  forgive  us  these  sins  and  to  cleanse  us 
from  unrighteousness.  Have  mercy  upon  us,  0  God,  after  Thy 
great  goodness  and  according  to  the  multitude  of  Thy  mercies  do 
away  with  our  offenses.  Open  Thou  our  lips  that  we  may  the  more 
acceptably  show  forth  Thy  praise  as  we  Thy  children  of  all  names 
would  blend  our  voices  in  glad  and  grateful  symphony  on  this 
Anniversary  day. 

May  Thy  still  small  voice  speak  again  to  us  in  all  the  service 
and  utterance  before  Thee  and  before  this  concourse  of  Thy  peo- 
ple, so  that  it  may  shape  the  signal  motive  of  this  "Nine  Years 
After"  celebration. 

Blessed  be  Thy  name  for  this  favored  land,  for  the  precious 
things  of  heaven,  for  the  dew  and  for  the  deep  that  coucheth  be- 
neath and  for  the  precious  fruits  brought  forth  by  the  sun  and 
for  the  chief  things  of  the  ancient  mountains  and  for  the  precious 
things  of  the  lasting  hills,  and  for  the  precious  things  of  the  earth 
and  the  fullness  thereof,  for  the  peace  we  enjoy,  for  our  guns  un- 
shotted,  our  war  ambulances  empty  and  stretches  unladen  and  our 
home  circles  not  battle  broken. 

Blessed  be  Thy  name  for  this  fond  city  of  St.  Francis,  for  its 
dauntless  conquest  of  the  great  disasters,  for  the  spirit  of  succor 
that  kindled  and  warmed  anew  the  brotherhood  of  the  nation  and 
of  the  world  to  help  us  help  ourselves,  for  the  speedy  and  splen- 
did upbuilding,  for  all  the  business  courage  and  acumen,  for  the 
high  financial  honor  in  banking  and  insurance  reparation,  for  our 
large-hearted  philanthropies,  for  the  restoration  and  betterment  of 


548       WORLD'S  INSURANCE  CONGRESS   . 

Thy  holy  Temples  and  for  all  onr  roseate  dawn  of  opportunity 
as  our  metropolis  stands  at  the  tryst,  so  big  with  meaning  for  the 
civilization  to  come,  between  the  Occident  and  the  Orient,  por- 
trayed here  before  Thee  in  this  very  "Court  of  the  Universe"  so 
inspiringly  sculptured  with  its  story  of  the  weal  and  the  woe  of 
the  destiny  of  man. 

Blessed  be  Thy  name  for  all  the  enchantment  of  this  exhibit 
of  the  wonders  Thou  hast  wrought  by  the  genius  of  man,  for  Thy 
new  pathways  for  the  waters,  for  this  world-record  feat  of  a  city 
crippled  less  than  a  decade  ago,  for  this  new  register  of  human 
achievement  in  every  avenue  of  human  effort,  but  above  all  we 
praise  Thee,  we  bless  Thee,  we  glorify  Thee  for  that  Thou  hast 
implanted  in  the  breast  of  man  a  conscience  to  work  for  righteous- 
ness through  the  ages,  a  love  for  our  fellow-man  to  assert  itself 
in  zeal  for  all  human  uplift,  a  consciousness  of  Thee  and  of  Thy 
Providence  and  of  the  ever  ennobling  devotion  to  Thy  worship. 
Stir  up  our  high  purpose  to-day  to  see  and  to  value  and  to  use  not 
only  this  wonderland  of  the  things  temporal  that  are  seen,  this 
Exposition  of  what  man  does,  but  that  more  vital  exhibit  in  the 
realm  of  the  eternal  things  that  are  not  seen,  that  exposition  of 
what  man  at  his  best  may  be  in  conscience,  in  love  and  worship, 
to  the  highest  chivalric  calls  of  time  and  of  eternity.  All  this 
we  ask  in  the  Name  of  Thy  Blessed  Son,  Who  hast  taught  us  to 
pray : 

Our  Father  Who  art  in  Heaven,  hallowed  be  Thy  name;  Thy 
Kingdom  come,  Thy  will  be  done  on  Earth  as  it  is  in  Heaven. 
Give  us  this  day  our  daily  bread,  and  forgive  us  our  trespasses 
as  we  forgive  the  trespasses  against  us.  Lead  us  not  into  tempta- 
tion, and  deliver  us  from  evil,  for  Thine  is  the  Kingdom,  the 
Power  and  the  Glory  forever.    Amen ! 


CHAIRMAN,  INTRODUCING  REV.  JOSEPH  P.  McQUAIDE, 

Ph.D. 

Bishop  Hanna,  who  is  unavoidably  absent,  has  deputed  to  speak 
for  him  one  who  needs  no  introduction.  We  all  love  Father  ^Ic- 
Quaide,  one  well  fitted  to  speak  on  San  Francisco — he  is  a  native 
son. 

THE  NEW  SAN  FRANCISCO 

By  Rev.  Joseph  P.  McQuaide,  Ph.D.,  for  Right  Rev.  Edward  J. 
Hanna,  Bishop  of  San  Francisco 

Two  men,  both  distinguished  in  their  respective  stations  of  life, 
entered  San  Francisco  in  April,  1906,  when  the  smoke  was  still 
issuing  from  the  burning  embere  of  the  fallen  City.    One  said,  in 


WORLD'S  INSURANCE  CONGRESS       549 

contemplating  the  disheartening  scene  about  him,  that  it  would 
take  a  race  of  giants  twenty  years  to  restore  San  Francisco.  The 
other,  in  a  short  address  before  a  gathering  of  the  chief  men  of 
the  City,  declared  that  he  was  a  citiz^'n  of  no  mean  City,  and  that 
San  Francisco  would  be,  ere  he  reached  the  end  of  his  days,  fairer 
and  greater  than  ever. 

Apparentl}^  one  of  these  men  did  not  know  us,  the  other  drd. 
And,  evidently,  he  who  did — it  was  our  late  and  beloved  Arch- 
bishop— felt  that  San  Franciscans  had  a  faith  in  God  as  well  as 
a  faith  in  themselves.  How  well  he  spoke,  and  as  we  feel,  thought, 
there  is  ample  evidence  about  us  to-day — nine  years  afterwards. 

We  who  vividly  recall  the  bitter  suffering  which  following  the 
disaster  of  April  18,  1906,  cannot  explain  the  hopeful  buoyancy 
of  the  people,  and  their  surety  that  a  City  more  beautiful  than 
the  old  but  beloved  one  would  arise,  except  by  an  innate  faith  of 
theirs  that  an  Omnipotent  Power  would  aid  them.  They  felt,  too, 
that  the  praj^ers  as  much  as  the  eyes  of  the  World  were  turned 
toward  them,  dimmed  by  the  tears  of  a  great  sympathy  and  pity. 
Hence,  they  despaired  not.  There  were  no  fears,  no  repinings. 
Men  went  about  with  a  firmer  step,  and  their  heads  were  raised  a 
little  higher.  Suffering  was  endured,  and  was  met  with  the  same 
courage,  the  same  California  spirit  of  manhood  Avhich  was  mani- 
fested especially  by  those  who  were  our  leaders  through  the  days 
of  trial.  It  was  God  in  His  kindly  light  leading  us  out  of  the 
encircling  gloom. 

It  is  no  sin  to  have  faith  in  oneself.  It  is  a  proud  thing  to  feel, 
though  prostrate,  that  you  are  not  crushed.  The  year  1906  saw 
an  appalling  calamity,  one  that  leveled  our  proud  business  blocks 
and  left  nothing  but  charred  ashes  of  thousands  of  our  beautiful 
homes.  But  this  disaster  only  checked,  it  did  not  stay  our  prog- 
ress. Before  the  embers  were  cooled,  the  New  San  Francisco  be- 
gan to  rise,  prouder,  richer,  more  beautiful  than  before.  The 
same  spirit  that  animated  the  Argonauts  of  '49  was  at  work,  with 
the  result  that  we  have  our  glorious  City  of  to-daj^  nine  years 
afterwards. 

We  had  every  reason  to  be  proud  of  Old  San  Francisco.  We  love 
to  remember  it  with  a  love  truly  patriotic.  And  yet,  we  have  rea- 
son to  love  the  New  San  Francisco  more.  The  New  City  is  the 
child  of  suffering  and  of  heroic  endeavor.  And  the  prodigious 
development  we  see  in  it  tells  us  that  the  years  and  centuries  are 
ours.  We  were  struck  a  blow  that  would  have  leveled  many  an- 
other City,  and  we  confronted  a  suffering  that  tried  our  stamina 
to  the  depths — and  we  live,  and  live  in  splendor,  and  in  the  prom- 
ise of  greater  things.  Proud,  therefore,  we  are,  and  as  we  ought 
to  be,  of  our  City. 


550  WORLD'S  INSURANCE  CONGRESS 


CHAIRMAN,    INTRODUCING   BENJAMIN   IDE    WHEELER 

The  next  speaker  is  one  who,  after  fifteen  years  of  hard  toil  in 
our  great  State  University,  has  won  the  respect  and  devotion  of  all 
the  people. 


CROWNED    BY    THE    WORLD'S    EXPOSITION 

By  Benjamin  Ide  Wheeler 
President,  University  of  California  ^ 

I,  for  my  part,  have  no  particular  mind  to  further  celebrations 
of  the  earthquake.  The  fates  of  geography  and  the  will  of  men 
have  made  that  event  no  more  than  a  passing  incident.  San  Fran- 
cisco looks  forward  and  not  backward.  All  her  history  so  far  has 
been  but  a  preface.  To-day  she  celebrates  her  entry  into  the  lists 
as  a  world-capital.  The  opening  of  the  Panama  Canal  gives  her 
the  place  in  the  modern  world  which  Byzantium  held  in  the  old. 
The  first  chapter  of  her  history  begins  with  1915.  The  last  para- 
graph of  the  preface  covers  the  last  nine  years. 

We  stand  here  just  nine  years  after  the  United  States  Congress 
in  1906  adopted  the  plan  and  started  the  work  of  the  Panama 
Canal.  That  is  the  only  "nine  years  ago"  which  I  am  willing  to 
regard.  With  that  year  San  Francisco  in  cauldrons  of  fire  cleaned 
house  and  began  the  preparation  of  a  new  San  Francisco  to  meet 
the  new  demands  of  a  new  place  and  duty  before  the  nations  of 
the  world.  The  Exposition  is  merely  San  Francisco's  "Coming- 
out  Ball." 

It  shall  be  a  New  San  Francisco.  Not  that  we  did  not  love  the 
old.  We  loved  her  very  dearly.  We  loved  her  for  her  open  and 
above-board  humaneness,  in  spite  of  her  waywardness,  for  it  was 
a  waywardness  of  charm.  We  loved  her  because  she  was  at  home 
with  herself.  She  had  her  own  way  of  doing  things  and  was  per- 
fectly content  that  others  might  have  theirs.  Call  it,  if  you  will, 
a  generous  and  large-minded  insularity.  We  who  knew  it  can 
never  forget  that  old  San  Francisco,  its  streets,  shops,  restaurants, 
theaters  and  general  bonhomie  no  matter  how  gay  and  glorious 
this  New  San  Francisco  may  become. 

Buf  surely  a  new  city  has  been  called  into  existence  to  meet 
a  new  need  and  take  a  new  place  in  the  economies  of  the  world. 
It  must  be  a  broad-minded  and  open-armed  San  Francisco.  It 
must  not  live  on  the  peninsula  alone ;  it  must  take  in  purview  the 
sweep  of  all  this  splendid  harbor  land.  It  must  be  large-hearted 
enough  to  embrace  Oakland. 

What  the  old  Dardanelles  and  Bosphorus  were  in  the  history 
of  the  ancient  world,  dividing  the  East  from  the  West,  that  has 


WORLD'S  INSURANCE  CONGRESS       551 

the  once  lonesome  Pacific  now  become  in  the  fact  unfolding  his- 
tory of  the  new.  The  world  has  faced  about;  the  ancient  gate  of 
the  West  was  at  Byzantium  and  the  Golden  Horn;  to-day  it  is 
San  Francisco  and  the  Golden  Gate. 

For  this  large  place  and  meaning  our  city  must  prepare  herself. 
A  new  place  makes  a  new  duty.  Here  must  be  brought  together 
and  moulded  and  kneaded  into  peaceful  community  life  all  the 
bloods  and  ideals  of  the  Occident.  Here  they  must  live  together. 
Here,  too,  the  Occident  and  Orient  must  meet  in  mutually  helpful 
interchange  of  products  and  ideas  and  service.  Here  they  must 
learn  to  know  each  other.  Of  knowledge  is  begotten  tolerance. 
Attend  now  and  listen:  the  reigning  spirit  of  the  New  San  Fran- 
cisco must  be  tolerance — a  large  human  tolerance  toward  bloods 
and  creeds  and  points  of  view,  a  tolerance  which  shall  be  to  the 
new  city  what  its  humanness  was  to  the  old,  both  sprung  from 
the  common  soil  of  sympathy. 

Called  to  the  dominion  of  the  seas,  she  springs  forward  to  her 
task  and  opportunity — the  new  city  that  looks  forth  as  the  morn- 
ing, fair  as  the  moon,  clear  as  the  sun,  and  glorious  as  an  army 
with  banners. 


CHAIRMAN,  INTRODUCING  DR.  DAVID  STARR  JORDAN 

A  great  educator,  who  is  also  a  mighty  champion  for  the  cause 
of  the  world's  peace. 


THROUGH  THE  COOPERATIVE  LIFE  IN  THE  TRIUMPH 

OF  PEACE 

By  Dr.  David  Starr  Jordan 
Chancellor,  Leland  Stanford,  Jr.,  University 

Nine  years  ago  saw  this,  our  City,  in  ruins.  It  had  seemed  to 
have  gone  the  way  to  be  "one  with  Nineveh  and  Tyre." 

Not  quite  a  year  ago  we  saw  the  continent  of  Europe  beginning 
to  fall  into  ruin  in  what  seemed  the  same  fashion.  A  year  ago, 
I  went — myself — through  two  hundred  miles  of  burned  villages, 
one  after  another.  These  were  the  villages  of  IMacedonia  destroyed 
in  the  last  war  in  the  Balkans,  so  many  times  destroyed  before  in 
other  wars,  but  these  were  scarcely  a  drop  in  the  bucket  compared 
with  the  ruined  cities  scattered  over  so  many  parts  of  Europe. 

Ours  was  an  Earthquake;  this  was  War.  Our  earthquake  was 
a  friendly  thing,  it  was  elemental;  it  bore  no  malice;  it  left  no 
recrimination.  It  was  on  so  mighty  a  scale  that  we  could  not  lie 
about  it.     We  could  not  exaggerate,  for  it  had  no  motive.     K 


552  WORLD'S  INSURANCE  CONGRESS 

reached  the  limit.  But  the  havoc  in  Europe  was  not  elemental. 
It  was  not  friendly.  It  was  all  due  to  the  stupidity  or  wickedness 
of  men,  of  some  few  men.  Its  operations  were  surrounded  by  an 
atmosphere  of  hate,  an  atmosphere  of  lies,  and  it  will  take  half  a 
century  for  the  world  to  know  the  truth,  for  the  nations  to  re- 
cover from  the  scorchings  of  its  hate. 

Our  earthquake  did  not  kill  many  of  us — in  truth,  it  did  not 
kill  any  of  us  Avho  are  here  to-day — it  did  not  destroy  nor  weaken 
the  generations  to  come ;  it  just  knocked  down  the  houses  and  then 
burned  them  up  and  left  us  to  put  them  up  again.  It  left  us 
hope  and  self-respect  while  we  were  doing  this.  The  earthquake 
in  Europe  not  only  destroys  the  property,  but  it  destroys  hope 
and  courage  and  friendship.  It  wrecks  the  lives  of  millions  of  the 
very  best  men,  and  with  these  it  destroys  thousands  of  women  and 
children  unable  to  support  themselves  amidst  these  horrors. 

It  impoverishes  the  next  generation.  It  will  be  a  hundred  years 
before  the  manhood  of  Europe  comes  back  to  what  it  was  before 
the  war.  For  war  always  selects  the  best  for  enlistment,  and  these 
it  remorselessly  destroys,  and  with  them  those  who  should  have 
been  their  progeny.  There  is  a  Spanish  proverb:  "Lions  breed 
lions ;  brave  men  have  brave  sons. ' '  But  when  the  brave  men  fall, 
the  next  generations  spring  from  those  too  weak  to  be  used  in  war. 
Like  the  seed  is  the  harvest. 

"We  have  a  right  to  be  thankful  to-day  that  nothing  worse  than 
an  earthquake  comes  to  us. 

We  are  here  representing  the  arts,  sciences,  commerce,  manufac- 
ture, insurance,  all  of  the  various  bonds  that  bring  men  together. 
War  stands  in  opposition  to  the  welfare  of  each  of  these. 

War  rests  primarily  on  three  things — three  kinds  of  stupiditv' 
and  wickedness.  These  are :  exploitation  of  foreign  countries,  mili- 
tarism and  the  domination  of  force  over  law,  and  fatalism,  the  be- 
lief on  the  part  of  the  people  that  war  is  inevitable  and  cannot  be 
prevented.  Half  the  civilized  world  supinely  believes  that  war 
comes  just  as  earthquakes  do,  or  the  rain,  or  snow,  or  sunshine, 
without  men  having  anything  to  do  with  it. 

War  is  not  elemental.  War  is  never  inevitable.  It  is  a  mon- 
ster that  we  make  ourselves,  and  for  which  we  are  responsible. 
If  the  people  in  Europe  had  been  awake  to  their  duties,  the  few 
that  wanted  war  could  never  have  brought  it  on. 

There  is  not  one  man  in  an  hundred  thousand  that  wanted  this 
war  and  now  not  one  in  a  million  who  wants  to  see  it  again.  If 
this  is  true,  can  we  not  do  a  bit  of  organization  against  it?  Can 
we  not  prevent  world  sickness  by  a  little  sanitation  of  govern- 
ments ? 

Some  men  blame  Christianity  for  not  preventing  this  war.  That 
is  as  much  as  to  say  that  war  is  wicked  and  that  it  is  Christianit^^'s 
business  to  stop  it.  That  is  paying  a  very  high  compliment  to 
Christianity.  I  hope  it  will  deserve  it  in  the  years  to  come  as  it 
has  largely  deserved  it  in  the  past. 


AVORLD'S  INSURANCE  CONGRESS  553 

But  again,  finance  did  not  stop  this  war.  That  is  saying  it  ought 
to  have  done  it.  This  war  will  cost,  by  the  first  of  August,  as 
much  as  all  the  farming  lands  in  the  United  States  are  worth  to- 
day. It  has  already  cost  more  than  the  whole  Empire  of  Russia 
would  sell  for.  Finance  ought  to  have  stopped  it.  They  could 
have  afforded  to  have  10,000  men  at  $10,000  a  year  each  for  ten 
years  to  work  to  counteract  the  evil  influence  of  the  hotheads  and 
fire-eaters.  To  bring  on  war  wantonly  is  the  work  of  murderers, 
and  the  crime  is  none  the  less  if  the  slaughter  has  the  sanction 
of  the  State,  or  even  the  blessing  of  the  Church. 

Commerce  does  not  stop  this  war.  I  saw  the  other  day  the  finest 
ship  ever  built,  costing  $10,000,000,  divested  of  $1,250,000  worth 
of  inside  furnishings.  She  was  painted  black  and  tied  by  her  nose 
to  a  wharf  at  Liverpool,  looking  as  sheepish  as  a  great  ship  can 
look.  She  was  turned  into  a  collier  to  go  about  supplying  war- 
ships in  the  open  sea.  The  Cunard  Company  did  not  build  the 
Aquitania  because  they  wanted  war.  They  were  not  envious  of 
German  Commerce.  Whoever  heard  of  an  Englishman  that  ever 
envied  anybody  anything? 

It  was  not  German  commerce  that  brought  on  the  war.  The 
Hamburg  Company  did  not  build  the  Imperator,  paying  $9,000,000 
for  her— borrowing  $6,000,000  of  it — for  the  sake  of  having  her 
tied  idle  at  the  wharf  at  Hamburg.  The  North  German  Lloyd 
Company  did  not  build  the  Vaterland,  another  of  these  same  great 
ships,  to  have  it  shut  up  in  New  York,  to  be  sold  at  last,  maybe,  for 
harbor-dues. 

Insurance  is  one  of  the  greatest  of  the  functions  that  bind  so- 
ciety together,  giving  security  and  basis  for  enterprise  and  for 
personal  initiative.  War  operates  adversely  to  all  its  interests. 
War  destroys  social  unity,  social  security,  personal  initiative,  dem- 
ocratic freedom,  and  paralyzes  every  form  of  progress.  It  has 
been  at  the  beck  and  call  of  reckless  exploiters  in  foreign  countries, 
and  its  tools  have  been  left  in  the  hands  of  a  small  ambitious  part 
of  the  community,  those  who  form,  from  the  standpoint  of  insur- 
ance, the  best  "risks."  Their  loss  enfeebles  the  whole  social  fab- 
ric and  entails  the  physical  and  intellectual  exhaustion  of  the 
nation  for  generations.  War  leaves  behind  as  fathers  of  the  next 
generation,  largely  those  weaklings  that  never  insure.  There  is 
no  form  of  equitable  business  that  is  not  injured  by  war,  and 
those  forms  of  business,  as  the  manufacturers  of  armament  in 
which  there  is  private  profit  in  war  time,  should  be  taken  over  by 
the  government.  This  line  of  enterprise  is  too  dangerous  to  trust 
in  private  hands.  It  is  for  business  men,  particularly  for  under- 
writers, to  begin  a  plan  of  insuring  against  war  and  similar  inter- 
national maladies  and  catastrophes. 

There  were  not  more  than  50,000  people  in  Europe  who  desired 
this  war,  and  less  than  that  number  to-day  have  any  clear  idea 
of  what  they  are  fighting  for.  If  there  had  been  50.000  intelli- 
gent Europeans,  compactly  organized  for  Peace,  and  able  to  spend 


554       WORLD'S  INSURANCE  CONGRESS 

a  little  money  for  travel  and  for  investigation,  they  could  prob- 
ably have  saved  Europe  $40,000,000,000  and  6,000,000,  more 
or  less,  lives.  If  we  really  desire  peace  and  desire  to  avoid  such 
ruinous  catastrophes,  we  must  do  a  little  work  for  it.  All  the 
money  ever  raised  in  Europe  for  the  promotion  of  good-will  would 
not  keep  the  present  war  running  fifteen  minutes. 

The  evil  in  regard  to  this  war  lies  primarily  in  the  fact  that  the 
people  in  most  of  the  countries  concerned  were  not  allowed  to  have 
anything  to  say.  War  smashes  the  ballot  box,  and  that  is  its  ulti- 
mate purpose.  The  immediate  cause  is  the  desire  of  a  few  men 
to  test  their  new  material  of  destruction.  These  men  are  gathered 
together  at  the  beck  of  reckless  exploiters  of  backward  countries. 
War  keeps  the  people  from  watching  their  interests,  or  voting 
upon  them,  or  doing  anything  except  to  pay  and  to  die.  The 
underwriters  of  the  world  should  form  a  compact  nucleus  of  an 
organization,  with  a  small  sum  of  money  behind  it,  to  promote  the 
security  and  stability  of  international  affairs. 

Labor,  industry,  have  no  wish  for  war.  It  should  be  banded  to 
prevent  it.  All  the  groups  should  have  committees  strongly  braced 
against  the  bringing  on  of  another  such  catastrophe,  the  senseless 
ruin  of  millions  of  men  and  women,  the  "picked  half-million"  of 
each  nation;  destroying  properties  on  a  scale  which  has  never 
been  known  before,  and  cheapening  the  future  of  all  nations  as  it 
has  never  been  cheapened  before,  because  it  puts  the  future  into 
weaker  hands.  The  longest,  most  terrible  cost  of  war  lies  in  the 
fact  that  it  spoils  the  breed. 

We  would  welcome  an  earthquake  at  any  time  rather  than  being 
brought  between  the  jaws  of  fratricidal,  suicidal  war. 


CHAIRMAN,    INTRODUCING   RABBI    MARTIN   A.   MEYER 

One  who  through  his  constructive  work  in  this  community  is 
well  fitted  to  speak  on  ''The  Brotherhood  of  Man." 


THE  BROTHERHOOD  OF  MAN 

By  Martin  A.  Meyer 
Rabbi,  Congregation  Emanu-El. 

The  experience  of  April  18th,  1906,  and  the  immediately  suc- 
ceeding days  are  indelibly  engraven  upon  the  soul  of  the  people 
of  San  Francisco,  for  the  incidents  of  those  trying  days  stirred 
our  souls  to  the  very  depths. 

The  great  shock  sent  many  a  one  to  an  early  grave.  The  physi- 
cal discomfort  was  the  least  factor  in  the  situation.     The  fear  of 


WORLD'S  INSURANCE  CONGRESS  555 

the  future,  much  more  than  the  privations  of  the  day,  decided  the 
fate  of  many  a  hitherto  brave  heart. 

Of  many  more  it  made  out-and-out  epicureans.  Seeing  the  ac- 
cumulated efforts  of  a  half  century  swept  away  in  a  moment 
seemed  to  prove  to  them  the  futility  of  provision  for  the  future. 
Since  things  were  so  transient,  they  would  sip  the  last  drop  from 
each  fleeting  moment  and  leave  the  future  to  care  for  itself.  How 
indifferent  their  judgment  was  to  one  of  the  biggest  factors  in  the 
rehabilitation  of  our  city,  the  event  has  proven!  For  had  it  not 
been  for  the  foresight  of  the  many  who  had  availed  themselves  of 
that  economic  institution  which,  popularly  called  insurance,  is  only 
the  foreseeing  and  cooperative  protection  of  the  present  for  future 
needs  and  emergencies,  had  not  the  many  availed  themselves  of 
this  practical  economic  measure,  the  rebuilding  of  our  city  would 
have  been  seriously  hampered. 

But  to  the  majority  of  our  citizens,  those  trying  days  gave  an 
experience  of  the  realities  of  brotherhood  and  of  the  impulse  of 
the  ideal,  experiences  which  will  ever  remain  among  San  Fran- 
cisco's most  cherished  possessions  and  traditions.  For  not  since 
pioneer  days  had  there  been  the  experience  of  the  realities  of 
brotherhood.  In  those  early  days,  all  had  stood  side  by  side,  equal, 
seeking  fortune  at  fortune's  shrine  of  toil.  Brothers  were  they 
in  fact,  gladly  sharing  the  contents  of  their  meager  larders  and 
their  well-nigh  empty  purses.  And  the  Great  Fire  leveled  our 
citizens  and  created  similar  conditions.  Economic  and  social  dis- 
tinctions were  destroyed  and  class  merged  into  class,  and  for  the 
once,  class  consciousness  separated  no  man  from  his  brother.  All 
stood  on  an  absolute  level,  for  need  made  all  akin.  Once  more 
they  were  brothers,  just  humans,  anxious  for  bread,  seeking  shelter 
and  protection  from  the  elements.  Service,  capacity  for  work  was 
the  sole  badge  of  difference.  And  for  several  days,  San  Francisco 
was  tried,  was  tried  as  silver  is  tried  in  a  fiery  furnace;  and 
pure  humanity,  undiluted  brotherhood  was  the  result.  In  the 
bread-line,  banker  and  pauper  were  alike.  And  as  the  pauper's 
arm  was  frequently  the  stronger,  he  was  if  anything  the  more  re- 
garded, as  there  was  need  to  work  for  the  new  City  even  though 
the  fire  still  raged  and  the  ashes  were  still  hot. 

We  learned  then,  too,  the  value  of  Lahor,  that  labor  is  the  great 
vitalizing  factor  in  economic  values.  The  world  might  have  sup- 
plied us  with  mountains  of  gold  and  silver;  but  labor  quickened 
the  dead  mass  and  with  its  magic  wand  bade  a  city  arise  out  of 
the  ruins:  and  obedient  it  rose. 

But  not  only  from  within  did  we  learn  of  humanity  and  fra- 
ternity. Hardly  had  the  world  heard  that  our  beautiful  City  was 
threatened  with  complete  destruction,  but  that  it  opened  its  heart 
and  poured  the  contents  of  its  purse  into  our  needy  laps.  Much 
was  given  from  motives  of  the  purest  philanthropy;  much  more 
came  from  that  great  fund  which  the  nations  of  the  world  had 
accumulated  through  cooperative  and  fraternal  effort  for  just  such 


556  WORLD'S  INSURANCE  CONGRESS 

emergencies.  Without  this  practical,  businesslike  manifestation  of 
humanity's  power  of  cooperation,  our  task  of  rehabilitation  would 
have  been  impossible. 

At  the  moment  of  our  great  loss  we  learned  too  of  the  value 
of  the  ideal,  of  a  realizable  ideal.  For  those  brave  hearts  which 
planned  the  new  on  the  ruins  of  the  old  were  led  on  by  a  vision, 
by  the  vision  of  a  city  finer  and  better  than  ever  before.  All 
worked  together  for  a  common  end.  The  New  San  Francisco  is 
the  creation  of  no  individual  but  is  the  realization  of  a  people's 
hope.  There  is  pardonable  exultation  in  our  hearts  to-day  for 
what  we  have  done,  even  though  at  the  same  moment  there  may  be 
the  sobering  consciousness  of  those  things  which  we  have  failed 
to  do.  As  a  matter  of  fact,  we  are  a  bigger,  finer,  healthier  and 
happier  city  than  we  have  ever  been.  Much  as  we  have  accom- 
plished, there  still  rise  before  us  the  possibilities  of  bigger  and 
better  things.  And  to  the  realization  of  this  further  vision  thou- 
sands of  earnest  and  noble  men  and  women  are  devoting  their  best 
efforts.  For  San  Francisco  will  not  rest  satisfied  till  that  it  be  a 
City  wherein  all  may  walk  in  peace  and  dwell  in  safety.  The  new 
City  was  built  not  only  to  satisfy  our  loyalty  to  the  old,  but  as 
a  pledge  of  our  hope  for  the  new  order  of  things.  It  was  built  in 
answer  to  a  dream  and  was  consecrated  by  the  brotherhood  of 
a  people  who  were  made  one  in  suffering,  in  service  and  in  sacrifice. 

And  what  was  San  Francisco's  in  those  trying  days,  and  what 
she  has  since  realized,  is  not  only  her  own,  but  a  trust  for  the  days 
yet  to  come,  and  for  all  the  peoples:  the  earth.  For  Brotherhood 
can  never  be  selfish,  even  in  its  least  expression.  To-day  we  stand 
as  the  first  city  of  this  western  coast.  We  are  to  be  the  emporium 
of  the  new  basin  of  the  world 's  history ;  not  only  an  emporium  for 
trade  in  goods,  but  above  all  else,  an  emporium  for  the  exchange 
of  ideas.  For  here  again  the  East  and  AVest  meet,  and  when- 
ever two  dissimilar  civilizations  meet,  out  of  the  conflict  is 
born  a  new  world  harmony.  The  completion  of  the  Pan- 
ama Canal  puts  us  at  the  point  of  vantage  for  this  historical  mis- 
sion. From  the  distant  river  valleys  of  the  old  east,  slowly  making 
its  way  about  the  shores  of  the  Mediterraneon,  across  Europe, 
working  its  way  northwards  and  westwards.  Civilization  has  made 
its  steady  advance.  For  four  centuries,  the  Atlantic  has  been  the 
scene  of  the  conflict  of  the  peoples.  Our  great  Pacific,  with  ita 
prophetic  name,  will  be  the  amphitheater  in  the  not  distant  future 
of  the  next  steps  of  the  world  progress.  And  we  of  this  city  and 
of  this  coast  will  be  the  mediators  between  the  East  and  the  West, 
between  the  old  and  the  new,  between  the  culture  of  Europe  and 
the  no  less  suggestive  culture  of  the  new-old  East. 

Already  we  of  the  Coast  have  developed  something  unique  out 
of  the  elements  which  the  seventy  nations  of  the  Avorld  have 
brought  to  us.  Distinctively  European,  it  is  nevertheless  tinged 
with  foreign  colorings.     Our  schools  and  colleges  arc  the  IMecca 


WORLD'S  INSURANCE  CONGRESS       557 

of  thousands  of  anxious  pilgrims,  who  come  as  the  forerunners  of 
a  great  mingling  of  cultures.  We  shall  here  interpret  the  West 
to  the  East  and  reconcile  the  East  to  the  West.  It  is  a  high  and 
holy  task  for  which  our  great  experience  in  brotherhood  has  pre- 
pared us.  We  can  but  compare  our  past  to  that  of  the  ancient 
city  of  Alexandria.  Situate  in  Egypt,  built  by  the  genius  of  one 
of  the  greatest  of  the  Greeks,  peopled  by  representatives  of  all  the 
nations  of  the  world,  it  became  the  mediator  between  the  Orient 
and  the  Occident.  There  Hebraism  was  assimilated  to  Hellenism, 
and  Hellenism  adapted  to  Hebraism;  and  out  the  harmony  was 
born  one  of  the  greatest  of  the  world's  movements,  that  complex 
which  to-day  we  call  Christianity. 

May  each  day's  setting  sun,  as  it  gilds  the  wide-reaching  waters 
of  the  broad  Pacific,  build  a  golden  bridge  by  which  we  may 
cross  to  the  brethren  of  the  East  and  bring  them  our  message  of 
righteousness  and  truth,  of  peace  and  good-will,  of  fraternity  and 
of  brotherhood. 

So  brothers  all,  let  us  to  our  task;  and  may  the  San  Francisco 
of  to-day,  the  new  City,  be  the  earnest  of  a  new  era  in  the  world's 
history,  wherein  all  the  families  of  the  earth,  in  mutual  respect 
and  appreciation,  may  develop  the  fullest  implications  of  the  di- 
vine thoughts  of  the  Fatherhood  of  God  and  the  Brotherhood  of 
Man. 


FIRE  UNDERWRITERS'  DAY 

Court  of  the  Universe — Exposition  Grounds 
Wednesday,  April  21,  1915 

(Under  the  auspices  of  the  Commission  in  charge  of  the  World's 
Insurance  Congress  Events.) 

The  next  public  event  of  an  insurance  nature  was  Fire  Under- 
writers' Day,  Wednesday,  April  21st.  It  was  held  in  connection 
with  the  thirty-ninth  annual  convention  of  the  Fire  Underwriters' 
Association  of  the  Pacific,  one  of  the  many  gatherings  of  that 
nature  centering  in  San  Francisco  as  a  result  of  the  work  of 
the  Insurance  Commission  of  the  Exposition.  An  automobile  pa- 
rade passed  from  the  insurance  center  of  the  City  to  the  Expo- 
sion  Grounds.  There  the  fire  insurance  men  were  received  by 
Exposition  officials  and  escorted  to  the  Court  of  the  Universe — 
the  scene  of  that  day's  celebration,  where  the  following  program 
was  carried  out : 


558  WORLD'S  INSURANCE  CONGRESS 


ADDRESS 

By  AV.  L.  Hathaway 

Commissioner,  World 's  Insurance  Congress  Events  of  the  Panama- 
Pacific  International  Exposition 

Ladies  and  Gentlemen — Members  of  the  Fire  Underwriters' 
Profession : 

It  is  my  desire  to-day  to  give  you  a  correct  understanding  of 
the  significance  of  this  occasion  to  the  great  business  which  you 
represent ;  for  this  occasion  is  significant — unique — in  the  history 
of  insurance  and  of  this  Exposition.  So  far  as  I  am  informed, 
this  is  the  first  time  in  the  course  of  the  world's  events  that  in- 
surance in  any  form  has  been  accorded  the  honor  that  will  be  ex- 
tended here  to-day  through  the  presentation  to  your  Association 
by  President  Moore  of  a  medal  commemorative  of  the  services 
performed  by  the  companies  which  j'ou  represent — services  with- 
out which  this  international  undertaking  could  never  have  been 
born. 

The  Panama-Pacific  International  Exposition  was  authorized  to 
exploit  to  the  world  an  understanding  of  the  extent  of  the  vari- 
ous arts  and  sciences  of  the  present  day. 

In  previous  expositions  all  other  forms  of  activities  than  In- 
surance have  been  afforded  their  opportunity  to  display  to  the 
world  an  understanding  of  what  they  were  doing  for  the  happiness 
and  comfort  of  mankind.  But  in  no  great  public  undertaking  be- 
fore has  Insurance  been  given  that  opportunity. 

It  is  therefore,  indeed,  a  matter  of  greater  importance  than 
it  might  casually  appear  that  Insurance  grasp  this  opportunity 
and  bring  to  the  attention  of  the  world  what  it  is  doing  to  benefit 
mankind,  for  at  the  present  time,  from  the  standpoint  of  social 
service  rendered  it  is  actually  the  leading  influence  of  the  Nation. 

Henceforth,  as  a  result  of  the  events  of  the  past  week  and  those 
of  an  Insurance  nature  which  are  to  come  in  the  Exposition  period, 
there  will  at  no  time  in  the  history  of  the  world  be  a  great  na- 
tional undertaking  such  as  this  in  which  Insurance  will  not  re- 
ceive its  full  meed  of  recognition.  This,  however,  will  more  cer- 
tainly be  the  case,  and  the  institution  of  Insurance  will  receive 
greater  credit,  in  proportion  to  the  success  which  Insurance  makes 
of  the  part  that  has  been  assigned  it  in  the  events  of  this  Expo- 
sition. 

I  think  a  word  of  special  commendation  should  be  given  to  those 
men  connected  with  the  fire  insurance  business  who  have  come 
to  the  front  so  splendidly  and  organized  not  only  this  meeting, 
but  have  played  a  goodly  part  in  the  organization  of  the  program 
of  last  Saturday.  I  especially  refer  to  men  like  the  President  of 
your  Association,  Mr.  Medcraft,  and  Mr.  Meade,  and  more  partic- 


"WORLD'S  INSURANCE  CONGRESS  559 

ularly,  Mr.  Williams,  who  has  been  untiring  in  his  efforts  for  the 
success  of  these  occasions.  The  far-reaching  importance  of  the 
success  of  this  occasion  entitled  them  to  your  heartiest  commen- 
dation. 

I  also  desire,  Ladies  and  Gentlemen,  that  you  have  a  correct 
understanding  at  this  time  of  how  this  recognition,  this  oppor- 
tunity to  appear  before  the  world  and  give  the  public  an  under- 
standing of  the  great  business  which  you  represent,  came  about. 

I  feel  you  should  understand  that  while  this  Exposition  has 
given  you  the  opportunity,  it  is  due  most  particularly,  as  mostly 
all  great  things  are,  to  one  man — a  man  who  has  grasped  the  sig- 
nificance of  Insurance,  yet  who  is  in  no  way  associated  with  the 
business,  but  who,  as  President  of  the  Exposition,  determined  to 
fulfill  its  obligations  to  give  to  all  equal  chance  to  exploit  to 
the  world  a  thorough  understanding  of  the  benefits  conferred 
upon  humanity  by  the  particular  activity  represented  by  each, 
has  readily  been  brought  to  understand  the  part  that  Insurance 
played  and  is  playing  in  the  realms  of  social  service,  and  has  so 
readily  accorded  to  Insurance  the  place  which  is  its  due,  but 
which  has  been  previously  denied  it  while  being  granted  to  many 
other  activities  but  small  in  comparison  to  that  which  you  repre- 
sent. 

In  presenting  to  you  the  President  of  the  Panama-Pacific  In- 
ternational Exposition,  Mr.  Charles  C.  Moore,  I  wish  to  say  that 
the  Insurance  business — of  to-day  and  of  to-morrow — owes  him  a 
great  deal  of  appreciation.  I  believe  that,  when  Insurance  as- 
sumes its  place  as  a  world  power,  and  when  Insurance  history  is 
written,  this  occasion  will  be  pointed  to  as  the  first  mile-pOvSt  on 
its  road,  and  that  at  the  head  of  its  history  will  be  placed  the 
name  of  the  man  who  has  contributed  more  to  the  success  of  In- 
surance— more  to  the  possibility  of  its  attaining  its  proper  social 
and  economic  position  than  any  other  one  man.  Ladies  and 
Gentlemen,  I  present  to  you,  Mr.  Charles  C.  Moore. 


ADDRESS 

By  Charles  C.  Moore 
President,  Panama-Pacific  International  Exposition 

When  Mr,  Hathaway  brought  his  plan  to  me  and  showed  me 
what  an  important  factor  Insurance  was  in  the  world,  I  became 
a  convert.  For  I  had  thought  that  insurance  men  were  men  who 
for  a  certain  sum  would  make  a  promise  to  do  something  that 
they  hoped  they  would  not  have  to  do;  but  since  Mr.  Hathaway 
and  his  associates  brought  to  me  and  showed  me,  a  plain  business 
man,  what  Insurance  is,  I  have  seen  that  Insurance  is  more  than 
a  commercial  spirit — it  is  benevolence — philanthropy.     I  am  glad 


560  AVORLD'S  INSURANCE  CONGRESS 

to  be  here,  to  know  that  the  world  will  know  more  of  Insurance. 
People  do  not  recognize  the  great  good  accomplished  by  Insurance. 
I  wouldn't  be  denied  the  privilege  of  coming  here  to-day  to  tell 
you  that  Insurance  deserves  its  proper  place  in  the  world's  ac- 
tivities. 

If  the  Exposition  helps  to  bring  Insurance  into  its  own,  that 
is  what  the  Exposition  is  for,  and  I  and  the  Exposition  officers 
will  feel  gratified.  I  am  a  business  man,  I  am  localized ;  but  you 
— you  are  world-wide. 


Mr.  Moore  then  presented  to  the  Fire  Underwriters'  Association 
a  bronze  plaque  in  commemoration  of  the  day  and  the  Exposition. 
Retiring  President,  R.  C.  Medcraft,  received  the  medal  and  thanked 
Mr.  Moore  for  his  courtesy,  and  for  the  recognition  extended  by 
the  directors  of  the  Exposition.     He  spoke  as  follows: 


ADDRESS 

By  R.  C.  Medcraft 
Retiring  President,  Fire  Underwriters'  Association  of  the  Pacific 

Many  of  us  were  present  on  Saturday  last  at  the  composite 
celebration  which  was  at  one  and  the  same  time  a  memorial  of 
the  City  as  it  was  before  the  fire,  a  testimony  to  the  reconstruction 
of  its  buildings,  and  an  act  of  homage  to  the  creative  genius 
of  this  beautiful  Exposition  in  the  grounds  of  which  we  are  to-day 
assembled. 

Our  presence  on  Saturday  testified  to  the  fact  that  fire  insur- 
ance is  one  of  the  factors  which  contributed  not  only  to  the  physi- 
cal reconstruction  of  the  city,  but  also  to  the  rehabilitation  of 
the  community  itself. 

To-day  we  stand  on  somewhat  different  ground  and  lay  our  gar- 
land at  the  feet  of  the  symbols  which  surround  us,  in  full  assur- 
ance that  the  noble  profession  to  which  every  one  of  us  is  proud 
to  belong  is  being  written  into  the  historical  annals  of  California, 
and  is  receiving  that  individual  recognition  which  is  its  due.  For 
I  would  have  you  remember,  sir,  that  the  science  of  fire  insur- 
ance is  as  ancient  as  that  of  law,  or  medicine,  or  architecture. 

It  is  very  true  that  after  the  first  evidences  which  are  discern- 
able  in  the  historj^  of  the  long  ago,  of  its  recognition,  there  oc- 
curred for  economic  reasons,  which  I  need  not  now  recount,  a 
very  long  interval  in  which  it  lay  dormant.  But  since  that  great 
day  in  the  seventeenth  century  when  the  practise  of  fire  insur- 
ance entered  upon  its  definite  career  it  has  continually  developed 
and  widened  its  beneficent  influence,  until  it  has  overspread  every 
portion  of  the  commercial  world. 

I  repeat,  sir,  that  it  is  a  venerable  science,  and  indeed  has  many 


WORLD'S  INSURANCE  CONGRESS       561 

a  notable  achievement  to  its  credit.  Its  principles  are  as  immu- 
table as  the  hills  yonder,  but  its  practical  developments  are  flex- 
ible and  adaptable  to  every  requirement  of  our  times. 

There  has  been  in  existence  on  this  Coast  for  nearly  forty 
years  an  organization  known  as  the  Fire  Underwriters'  Associa- 
tion of  the  Pacific.  Its  origin  partakes  of  true  romance  and  its 
members  are  proud  to  know  that  there  are  still  among  them  eight 
of  the  original  founders.  It  has  always  had  two  marked  char- 
acteristics—the one  educational,  the  other  fraternal.  Its  member- 
ship has  always  been  comprehensive.  We  have,  sir,  among  our- 
selves, different  schools  of  insurance  practice.  In  each  school  are 
found  the  same  sense  of  responsibility,  the  same  honest  intent, 
the  same  brain  work.  But  the  Fire  Underwriters'  Association 
takes  no  account  of  school  or  standpoint.  It  embraces  them  all 
within  its  ample  folds,  and  hence  is  able  to  present  to  you,  sir, 
to-day,  as  a  unit  the  entire  fire  insurance  fraternity  of  the  Pacific 
Coast,  and  indeed  of  the  United  States.  In  the  name  of  that 
vast  unit,  I  thank  you,  sir,  for  this  official  reception,  and  pre- 
sent to  you,  as  our  spokesman,  one  whose  name  is  known  from 
San  Diego  to  British  Columbia,  thence  to  Northern  Maine,  thence 
to  Southern  Florida  and  back  again  to  San  Diego — an  active,  civic 
worker,  a  former  member  of  our  Association,  and  now  an  honor- 
ary member — Mr.  William  J,  Duttou. 


ADDRESS 

By  William  J.  Dutton 

Ex-President.  Fireman's  Fund  Insurance  Company, 
San  Francisco,  Cal. 

Mr.  President,  Ladies  and  Gentlemen,  Friends  all:  The  first 
thing  I  think  I  should  do  is  to  apologize  to  j-ou  for  appearing  be- 
fore you  with  a  written  speech.  There  is  a  reason  for  it.  My  pref- 
erence would  have  been  to  have  selected  my  topic  and  then  depended 
upon  Providence.  The  reason  for  my  written  speech  is  the  activ- 
ity of  our,  what  I  might  call,  insurance  newspaper  department. 
For  know  ye  that,  with  the  carrying  on  of  this  Exposition  here, 
an  enterprising  newspaper  organization  has  started  something 
never  before  attempted,  and  has  commenced  the  putting  out  of 
a  daily  insurance  newspaper.  And  the  gentleman  in  charge  of 
it  sent  his  printer's  devil  (or  some  other  one)  to  me,  demanding 
a  copy  of  my  speech.  I  said  I  had  none.  He  said  they  must  have 
it.     So  I  have  written  them  one. 

As  I  look  about  among  these  peace  blessed  surroundings,  I  can 
but  contrast  them  with  the  conditions  in  other  parts  of  the  world 
— with  the  situation  among  European  nations.  While  elsewhere 
the  nations  are  facing  an  almost  world-wide  vrar,  our  people  are 


562  WORLD'S  INSURANCE  CONGRESS 

here  gathering  to  demonstrate  and  to  celebrate  the  accomplish- 
ments of  peace.  AVliile  Europe  is  bathed  in  blood  and  adversity, 
our  country  is  basking  in  the  sunshine  of  prosperity.  While  other 
so-called  enlightened  nations  have  been  training  their  boys  for 
soldiers  and  straining  every  nerve  to  kill  one  another,  we  have 
been  equipping  Red  Cross  chapters  to  succor  the  wounded  and 
have  been  sending  shiploads  of  provisions  to  alleviate  the  distress 
of  non-combatants,  thus  to  fulfill  the  Scriptural  injunction  "Bear 
ye  one  another's  burdens." 

This  precept,  second  in  importance  only  to  the  Golden  Rule, 
furnishes  the  solid  foundation  upon  which  is  built  tlie  whole  su- 
perstructure of  underwriting.  In  the  early  days  of  scattered  risks 
and  small  community  values,  it  was  not  difficult  for  neighbors  to 
mutually  protect  one  another  against  loss  by  fire.  But,  with  the 
growth  of  cities  and  the  extensions  of  commerce,  the  great  fire 
insurance  corporations  became  a  necessity.  Insurance  has  been 
known  as  the  handmaid  of  commerce.  That  is  not  broad  enough. 
Capital  is  the  life  and  Insurance  is  the  life  preserver  of  com- 
merce. Under  its  protecting  tpgis,  the  fleets  of  the  Avorld  travel 
the  seas  in  commercial  pursuits.  The  merchant  is  able  to  give 
and  receive  credit,  and  the  banker  rests  firmly  and  safely  as  the 
custodian  of  other  people's  money. 

AVithout  the  aid  of  underwriting  this  Jewel  City  would  never 
have  arisen,  nor  could  its  founders  have  secured  the  wonderful 
collection  of  articles  which  adorn  its  aisles  and  fill  its  palaces. 
And  never  was  the  value  of  great  insurance  corporations  shown 
more  fully  than  at  the  time  of  our  conflagration  of  1906.  The 
President  has  referred  in  glowing  terms  to  what  underwriters 
have  done  for  San  Francisco,  and  to  the  settlements  made  at  the 
time  of  the  conflagration.  His  statements  are  true,  and  his  com- 
mendation is  well  deserved.  But  there  is  really  due  a  broader  com- 
mendation than  that  which  he  has  given — it  should  include  all  our 
citizens.  AVhile  it  is  quite  true  that,  in  the  number  of  cents  on 
the  dollar,  underwriters  paid  more  at  the  time  of  our  settlement 
of  conflagration  losses  than  was  paid  in  previous  similar  cases, 
as  at  Boston  or  Chicago,  still  there  was  reason  for  it.  The  com- 
panies involved  in  these  previous  disasters  were  mostly  small 
concerns,  with  neither  pride  of  permanency  nor  experience  of 
management.  The  large  and  financially  strong  and  seasoned  com- 
panies then  as  now  paid  promptly  and  well  sustained  the  under- 
writing integrity  of  both  America  and  England.  But  there  was 
another  reason  for  the  satisfactory  settlement  of  our  San  Fran- 
cisco losses.  The  integrity  of  our  underwriters  only  kept  pace 
with  the  energ;^'^  of  our  people,  and  only  measure  up  with  the 
braverj'  of  all  the  population  of  San  Francisco.  Our  resident  in- 
surance men  were  simply  a  part  of  our  community,  only  a  unit 
of  our  citizens  engulfed  in  the  same  avalanche  of  ruin  and  im- 
bued with  the  same  spirit  which  defied  disaster  and  denied  defeat. 
Visiting  underwriters   and   adjusters   caught   this   spirit   of  local 


WORLD'S  INSURANCE  CONGRESS       563 

pride  and  ambition,  and  "fellow-feeling  made  ns  wondrous  kind." 
Had  our  citizens  faltered  at  that  time  our  underwriters  would 
have  lost  their  enthusiasm.  Cold  calculation  would  have  sup- 
planted generosity.  Perhaps  a  few  millions  of  dollars  would  have 
been  saved  by  underwriters,  but  the  opportunity  would  have  been 
lost  for  our  presence  here  to-day  to  receive,  at  the  hands  of  our 
fellow-citzens,  the  tribute,  "Well  done,  good  and  faithful 
servants. ' ' 

Mr.  President,  we,  the  Fire  Underwriters  of  San  Francisco, 
among  whom  it  has  been  my  honor  and  pleasure  to  have  passed 
a  long  term  of  business  life,  gratefully  accept  this  token  of  appre- 
ciation which  will  for  future  years  grace  the  archives  of  fire  un- 
derwriting of  San  Francisco,  as  a  permanent  and  visible  record 
and  recognition  of  merit  and  a  reminder  also  of  this  Exposition, 
which  will  stand  as  a  model  for  future  generations  to  strive  to 
equal,  though  they  may  not  excel. 


ADDRESS 

By  Rolla  V.  Watt 
Ex-President,  Board  of  Fire  Underwriters  of  the  Pacific 

The  origin  and  development  of  methods  of  relief  for  the  indi- 
vidual loser  through  the  contribution  of  the  many  is  an  interest- 
ing study.  Communal  provisions  for  such  relief  were  evidently 
resorted  to  in  very  early  days.  In  England  and  Germany  guilds 
were  formed,  usually  among  people  of  the  same  religious  faith — 
one  of  them,  that  of  the  Blessed  Mary  (1218),  proclaimed  its 
good  offices  as  follows :  ' '  Help  is  Given  in  Case  of  Loss  by  Fire, 
Murrain,  Robbery,  or  other  Mishap,  so  that  such  Loss  Come  Not 
Through  His  Own  Lust,  or  Gluttony,  or  Dice-Play,  or  other  Folly, 
viz:  2d." 

Marine  insurance  became  a  factor  in  commerce  in  advance  of 
fire  insurance.  No  less  eminent  a  man  that  Francis  Bacon  inter- 
ested himself  in  the  business  to  the  extent  of  offering  an  insur- 
ance bill  in  the  House  of  Commons  in  1601.  In  presenting  the  bill 
he  said:  "A  certainty  of  gain  is  that  which  this  law  provides  for. 
This  is  the  lodestone  which  draws  him  on  to  adventure  and  to 
stretch  the  very  punctilio  of  his  credit." 

This  bill  was  considered  by  a  notable  committee.  Sir  Walter 
Raleigh,  Mr.  Dr.  Caesar  (Judge  of  the  Admiralty  Court),  Sir 
Stephen  Soam  and  Sir  Francis  Bacon,  and  was  adopted. 

Organized  fire  insurance,  as  practised  to-day,  however,  may  be 
said  to  have  originated  following  the  great  London  fire  in  1666. 
This  historic  conflagration  was  a  most  appalling  calamity ;  over 
80  per  cent  of  the  buildings  in  London  w^ere  destroyed,  while 
the  property  loss  was  estimated  at  10,000,000  pounds,  or  $50,000,- 


564  WORLD'S  INSURANCE  CONGRESS 

000 — a  sum  which  at  present  values  would  perhaps  equal  the 
proportions  of  the  San  Francisco  disaster.  The  loss,  however, 
in  that  case  fell  almost  entirely  upon  the  people  whose  property 
was  destroyed. 

Recovery  from  this  conflagration  was  slow,  but  almost  immedi- 
ately individuals  undertook  to  supply,  by  private  contracts,  guar- 
antees against  fire  losses,  and  in  1680  a  partnership  called  "The 
Fire  Oflfices"  was  formed.  Other  partnerships,  corporations  and 
friendly  societies  sprung  up  from  time  to  time,  and  in  1681  the 
City  of  London  attempted  to  make  itself  a  municipal  fire  insurance 
company.  The  enterprise  did  not  prosper  and  was  abandoned  in 
1683.  The  fatalities  among  insurance  companies  during  the  248 
years  since  the  first  fire  insurance  office  was  opened  have  been 
startling.  There  have  been  809  fire  insurance  companies  or  so- 
cieties promoted  in  Great  Britain  since  1667,  80  per  cent  of  which 
have  failed  or  otherwise  retired  from  business. 

During  all  the  intervening  years  there  has  been  a  struggle  for 
the  maintenance  of  the  altruistic  idea  of  insurance — a  conflict  be- 
tween the  broader  and  the  narrower  view  of  the  business.  Many 
can  only  see  the  selfish  business  profit-seeking  features  of  the  en- 
terprise, but  broader  minded  men  have  recognized  the  commercial 
necessity,  the  economic  value  of  this  branch  of  social  service.  In 
1755,  Nicholas  Magens,  writing  on  the  subject,  said:  "Insurances 
promote  trade  and  navigation  and  thereby  the  risks  of  diligent,  in- 
dustrious and  inventive  persons  of  small  capital  are  so  lessened 
that  they  may  engage  even  in  important  undertakings." 

Evidently  in  that  day  there  were  those  w^ho  inveighed  against 
the  profits  which  the  companies  were  making,  for  Adam  Smith  in 
his  "Wealth  of  Nations"  1776),  said:  "That  the  chance  of 
loss  is  frequently  undervalued  and  scarcely  over-valued  more 
than  its  worth,  we  may  learn  from  the  very  moderate  profits  of 
insurers.  ...  It  seems  evident  enough  that  the  ordinary  balance 
of  profit  and  loss  is  not  more  advantageous  in  this  than  in  com- 
mon trade."  He  goes  on  to  say,  that  "Before  the  establishment 
of  the  two  joint  stock  companies  for  insurance  in  London,  a  list, 
it  is  said,  was  laid  before  the  attorney-general  of  150  private  in- 
dividuals who  had  failed  in  the  course  of  a  few  years."  He  adds: 
"The  trade  of  insurance  gives  greater  security  to  the  fortunes  of 
private  people." 

Fire  insurance  has,  however,  received  little  assistance  or  encour- 
agement from  the  various  governments.  As  early  as  1694  a  stamp 
duty  was  imposed  upon  fire  insurance  policies  which  was  grad- 
ually increased  until  it  reached  3  cents  for  each  100  pounds  in- 
sured. The  tax  was  strongly  objected  to  "as  a  discouragement  to 
prudence  and  as  disproportionate  in  rate  to  the  cost  of  in.surance, 
but  it  was  easily  collected  and  yielded  a  large  revenue  and,  there- 
fore, naturally  died  hard."  In  1864  the  tax  was  partially  re- 
moved and  finally  expired  in  1869.    That  was  in  England. 

In  the  United  States  the  tendency  is  towards  increased  taxes 


WORLD'S  INSURANCE  CONGRESS  565 

until  they  have  become  a  veritable  burden  upon  underwriting  in- 
stitutions. Unfortunately,  there  is  now  a  tendency  to  so  hamper 
and  control  the  business  as  to  make  it  unprofitable  and,  therefore, 
unstable.  Unwittingly,  the  legislators,  many  of  whom  are  not 
business  men,  many  of  whom  have  not  the  slightest  grasp  on  the 
theories  of  commerce  or  trade,  for  political  purposes,  without  re- 
gard to  the  welfare  of  the  community,  adopt  measures  well  cal- 
culated to  discourage  capital  from  entering  this  business  so  essen- 
tial to  the  prosperity  of  the  commonwealth. 

Antagonistic  insurance  legislation  is  usually  popular  because 
insurance  companies  are  regarded  as  tax-gatherers,  which,  in  fact, 
they  are.  Moreover,  most  rate-payers,  in  the  nature  of  the  case,  do 
not  receive  any  direct  money  returns  since  the  few  only  suffer  from 
fire  loss.  The  opposition  to  insurance  is  more  common  than  to 
even  railroad,  electric  or  water  corporations,  because  all  of  the 
rate-payers  of  the  latter  corporations  receive  something  in  ex- 
change, while  the  insurance  companies  give  only  an  intangible 
guarantee  of  indemnity  against  a  contingency  which  comes  ta 
few.  Plappily  there  is  a  tendency  to  recognize  more  definitely  the 
good  offices  of  insurance. 

The  insurance  business  was  early  introduced  into  this  country. 
Many  companies,  both  stock  and  mutual,  were  organized  and  ran 
their  more  or  less  precarious  careers. 

In  1837  the  State  of  Massachusetts  provided  that  fire  insurance 
companies  should  maintain  a  fund  to  guarantee  their  contracts 
being  carried  out.  This  action  marked  the  entrance  of  the  State 
into  the  insurance  field  and  from  this  modest  beginning  has  grad- 
ually developed  the  extensive,  and,  in  some  States,  obstructive 
legal  systems  now  prevailing.  We  must  all  concede  that  it  is  not 
only  the  right  but  the  duty  of  the  State  to  maintain  such  super- 
vision over  the  business  as  will  result  in  the  maintenance  of  safe 
reserves  and  in  their  proper  investment. 

The  first  great  conflagration  in  this  country  occurred  in  New 
York,  December  16,  1835.  It  destroyed  property  to  the  value  of 
$15,000,000  and  bankrupted  twenty-three  out  of  the  twenty-six 
companies  doing  business.  In  1851  there  were  two  conflagrations 
in  San  Francisco  which  destroyed  3,750  buildings,  with  a  property 
loss  of  $16,500,000.  Then  came  the  great  Chicago  fire  of  1871, 
where  17,430  buildings  were  destroyed,  with  a  property  loss  of 
$168,000,000,  which  bankrupted  forty-five  insurance  companies.  A 
year  later  came  the  Boston  fire,  with  a  loss  of  $75,000,000;  and 
then  the  St.  Johns,  N.  F.,  with  a  loss  of  $25,000,000 ;  then  Balti- 
more, with  a  loss  of  $50,000,000;  and  finally,  as  a  climax,  San 
Francisco,  with  a  loss  of  $350,000,000.  It  is  noteworthy  that  fewer 
fire  insurance  companies  were  bankrupted  by  enormous  losses  sus- 
tained in  San  Francisco  than  by  the  Chicago  conflagration,  with 
less  than  one-half  the  total  loss,  or  even  the  New  York  conflagra- 
tion of  1835,  aggregating  a  loss  of  only  $15,000,000.  This,  as  one 
writer  says: 


566  WORLD'S  INSURANCE  CONGRESS 

"Offers  evidence  that  tlie  interests  of  the  insurance  companies  are 
probably  under  more  scientific  control  and  that  they  have  evi- 
dently more  than  kept  pace  with  their  enormously  increasing  re- 
sponsibilities. ' ' 

If  the  true  social  service  values  of  fire  insurance  are  properly 
recognized  by  the  public  and  by  the  legislatures  of  the  various 
States,  there  is  every  promise  that  in  the  future  the  companies 
will  so  manage  their  affairs  as  to  be  able  to  meet  any  strain  which 
may  be  put  upon  them. 

"The  causes  of  fire  are  of  far  greater  variety  than  is  commonly 
known ;  there  are  hazards  almost  infinite  in  number,  for  practically 
every  substance  and  almost  every  process  of  labor,  manufacture  or 
commerce  is,  under  certain  circumstances,  or  in  certain  relation  to 
other  articles  or  processes,  productive  of  danger  from  fire." 

To  develop  a  rating  system  which  will  meet  the  hazard  insured 
against  has  required  long  years  of  patient,  painstaking  care  and 
experimentation.  Originally,  rates  were  made  by  guess.  Sched- 
ules have  been  developed  covering  various  classes  of  hazards  where- 
by standard  risks  take  minimum  rates,  and  departure  from  stan- 
dards are  penalized  by  certain  fixed  percentages  to  the  basis.  By 
means  of  schedule  rating,  companies  are  able  to  point  out  to  the 
insured  improvements  which  may  be  made  whereby  the  rate  will 
be  automatically  reduced.  "While  the  rating  systems  are  still  far 
from  perfect,  they  have,  nevertheless,  been  wonderfully  improved 
during  the  last  few  years  and  will  continue  to  improve.  A  deter- 
mined effort  is  being  made  to  prevent  discrimination  as  between 
risks,  localities  and  individuals.  A  difficult  problem  to  deal  with 
is  the  moral  hazard,  the  cost  of  which  must  be  loaded  into  the 
rates  as  a  whole,  for,  obviously,  a  charge  for  moral  hazard  cannot 
be  added  to  any  specific  risk. 

It  is  difficult  to  make  the  public  understand  that  insurance 
companies  prefer  low  rates  to  high  and  that  they  are  constantly 
endeavoring  to  suggest  methods  for  the  reduction  of  the  fire 
waste.  To  that  end  the  companies  maintain,  at  a  very  large  cost, 
a  laboratory  at  Chicago  for  testing  lighting,  heating  and  other 
devices  with  a  view  to  determining  their  safety,  and  for  trying  out 
fire  extinguishing  and  other  fire  prevention  apparatus,  for  test- 
ing building  materials,  etc.  The  companies  have  also,  at  large 
expense,  provided  building  and  electrical  installation  codes  for 
the  guidance  of  public  officials.  Practically  evei*y  important 
town  and  city  in  the  United  States  has  been  inspected  and  re- 
ported upon  as  to  construction,  protection  and  conflagration  prob- 
abilities by  the  most  eminent  engineers  available.  Inspecting,  sur- 
veying and  rating  departments  are  maintained  in  numerous  cities 
throughout  the  country.  All  of  this  constitutes  a  public  service 
rarely  recognized  or  appreciated,  but,  nevertheless,  of  the  greatest 
possible  value  to  property  owners  and  a  service  which,  in  the 


WORLD'S  INSURANCE  CONGRESS  567 

nature  of  the  case,  could  not  be  rendered  except  through  associated 
effort. 

Forms  of  policy  contracts  have  been  gradually  broadened  and 
made  more  and  more  favorable  to  the  insured.  The  general  use 
of  the  coinsurance  clause  tends  to  the  equalization  of  insurance 
cost. 

I  have  resisted  the  temptation  to  refer  to  the  magnitude  and 
importance  of  fire  insurance  in  dollars  on  this  occasion;  but  it 
may  not  be  out  of  place  for  me  to  close  with  a  brief  reference 
to  the  relation  of  the  business  to  our  own  City  and  State.  The 
conflagration  of  1906  reduced  400  blocks  of  buildings  to  ruins; 
28,000  houses  were  destroyed ;  the  property  loss  was  approximately 
$350,000,000,  the  companies  paid  approximately  $200,000,000.  We 
drew  upon  the  whole  civilized  world  for  relief.  The  reserves  of 
many  companies  were  more  than  exhausted  and  to  enable  them  to 
continue  in  business  it  was  necessary  for  them  to  pay  in  new  funds 
to  the  extent  of  more  than  $50,000,000. 

San  Francisco  is  a  monument  to  the  practical  value  of  fire  in- 
surance. As  has  been  well  said  in  commemoration  of  the  Ninth 
Anniversary  of  the  San  Francisco  Conflagration: 

"When  the  City  suffered  in  the  destruction  of  property  to  the 
extent  of  several  hundred  million  dollars,  the  means  for  its  re- 
placement had  already  been  provided  for,  through  that  coopera- 
tive spirit  known  as  'Insurance,'  to  the  end  that  the  burden  of 
this  City 's  reconstruction  fell  very  largely  and  evenly  through  that 
part  of  the  civilized  world  of  leading  commercial  activity.  Nor 
does  the  fact  that  a  commercial  spirit  entered  of  necessity  into  the 
act  diminish  the  force  of  the  altruistic  life  thus  presented." 

FRATERNAL  DAY 

Court  of  the  Universe — Exposition  Grounds 
Thursday,  April  22nd,  1915 

(Under  the  auspices  of  the  Commission  in  charge  of  the  World's 
Insurance  Congress  Events.) 

Fraternal  Day,  Thursday,  April  22nd,  was  fittingly  observed 
by  a  monster  parade,  composed  of  fully  one  hundred  decorated 
automobiles,  a  number  of  floats  and  tallyhos,  and  thousands  of 
marching  fraternals  from  all  over  the  United  States,  which  en- 
tered the  Scott  Street  entrance  of  the  Exposition  Grounds  and 
passed  the  reviewing  stand  in  front  of  the  Fountain  of  Energy. 
Here  thousands  of  fraternals  gathered  to  hear  the  addresses  made 
by  their  national  leaders.  Charles  W.  Dempster,  Supreme  Sec- 
retary of  the  Fraternal  Brotherhood,  and  Chairman  of  the  Fra- 
ternal Day   Committee,   opened  the   exercises  and   explained   the 


568  WORLD'S  INSURANCE  CONGRESS 

reasons  for  the  gathering — Fraternal  Insurance.  He  then  intro- 
duced the  Hon.  John  J.  Lentz,  national  President  of  the  American 
Insurance  Union,  as  Chairman  of  the  Speakers'  Committee,  who 
spoke  as  follows: 


INTRODUCTORY  ADDRESS 

By  John  J.  Lentz 

Special  Chairman,  National  President,  American  Insurance  Union, 

Columbus,  Ohio 

Ladies  and  Gentlemen:  The  Panama-Pacific  International  Ex- 
position extended  us  no  ordinary  privilege  in  setting  apart  the 
22nd  of  April,  1915,  as  Fraternal  Day,  and  the  thought  that  is 
uppermost  in  my  mind  is  that  of  the  significance  of  this  meeting 
of  the  Fraternalists  of  a  continent,  here  on  these  grounds  where 
the  grandest  exposition  of  the  world  is  the  proud  boast  of  San 
Francisco  and  of  California.  The  thought  that  is  uppermost  in 
my  mind  is  that  of  the  significance  of  such  a  meeting  as  this  un- 
der the  auspices  of  such  men  as  constitute  the  management  of  this 
Exposition.  There  was  a  time  when  business  men  were  inclined 
to  believe  that  fraternal  life  insurance  associations  were  not  wor- 
thy of  recognition.  There  was  a  time  w^hen  the  business  men 
thought  the  fraternalistis  were  more  interested  in  dress  parade 
swords,  belts  and  feathers  than  in  the  financial  integrity  and 
trustworthiness  of  their  promises  to  pay  widows  and  orphans  af- 
ter the  grim  reaper  had  taken  the  bread-winner  away,  and  unfor- 
tunately some  business  men  still  think  that  the  fraternal  life  as- 
sociations are  of  short  duration,  offering  but  temporary  protec- 
tion. Prejudice  strikes  its  roots  deep  in  the  minds  of  many  men, 
and  many  failures  in  business,  in  society  and  in  politics  are  due 
to  prejudice.  The  man  who  cannot  revise  his  opinions  and  cor- 
rect them  from  time  to  time  by  keeping  pace  with  the  new  thoughts, 
the  new  facts  and  the  new  discoveries  is  very  apt  to  be  a  failure, 
and  whatever  his  business  or  profession  may  be,  his  prospects 
for  success  will  decrease  in  exact  proportion  as  his  prejudices 
increase. 

We,  the  representatives  of  the  life  insurance  fraternities,  con- 
sider ourselves  fortunate  in  this  opportunity  to  share  with  you 
to-day  the  beauty  and  inspiration  of  this  great  Exposition,  and 
while  doing  so,  to  call  your  attention  to  the  gigantic  proportions 
of  our  benefactions  to  humanity.  You  will  be  surprised  to  learn 
that  we  are  but  a  few  of  ten  million  policyholders  in  the  United 
States.  As  members  of  the  National  Fraternal  Congress  of 
America,  we  represent  organizations  tliat  have  for  several  years 
been  distributing  a  hundred  million  dollars  annually,  or  two  mil- 
lion dollars  a  week,  among  the  widows  and  orphans  of  the  United 


WORLD'S  INSURANCE  CONGRESS       569 

States,  manj^  of  whom  would  be  left  penniless  were  it  not  for  the 
business  sense,  as  well  as  the  fraternal  spirit,  of  such  men  and 
women  as  constitute  the  National  Fraternal  Congress. 

There  was  a  time  when  the  life  insurance  fraternities  were 
justly  criticized  for  passing  around  the  hat  after  death,  but  these 
criticisms  are  unfair  and  unwarranted  to-day.  There  has  been 
progress  in  fraternal  insurance  just  as  there  has  been  in  facilities 
for  transportation.  There  was  a  time  when  it  took  several  months 
in  stage  coaches,  buckboards  and  on  horseback  to  cross  the  Ameri- 
can continent,  but  we  have  brought  our  transportation  facilities 
out  of  the  prairie  mud  and  off  the  corduroy  roads  across  the 
marshes,  up  to  the  steam  and  electric  railways,  carrying  palaces 
at  the  rate  of  a  mile  a  minute,  and  substantially  in  the  same  period 
we  have  brought  fraternal  life  insurance  from  a  basis  of  charity 
and  catch-as-catch-can  up  to  a  scientific,  actuarial  and  financial 
system  in  which  each  and  every  one  of  the  ten  millions  of  policy- 
holders is  being  educated  and  trained  to  pay  the  actual  and  full 
cost  in  small  monthly  premiums,  and  thus  we  of  the  fraternal 
societies  stand  ready  to  pay  to  our  beneficiaries  one  hundred  mil- 
lion dollars  a  year,  and  doing  so  we  resent  the  charges  and  insin- 
uations that  the  fraternal  associations  are  furnishing  temporary 
insurance.  We  are  increasing  the  benefits  every  year,  and  for 
many  years  have  been  paying  life  insurance  one  hundred  cents 
on  the  dollar  into  the  homes  of  one-third  of  the  total  population 
of  the  United  States.  With  all  the  misrepresentations  and  insin- 
uations against  the  fraternalists,  we  are  to-day  paying  every  policy 
in  full,  one  hundred  cents  on  every  dollar,  and  it  can  safely  be 
said  that  with  the  steadfast  and  rapid  increase  toward  adequacy 
of  rates,  substantially  every  life  insurance  fraternity  doing  busi- 
ness to-day  will  pay  its  every  policy  in  full  as  it  matures.  I 
might  go  farther  and  say  of  the  great  life  insurance  fraternities 
of  America,  that  they  are  now  among  the  greatest  financial  insti- 
tutions of  our  great  Republic. 

Two  years  ago  I  had  occasion  to  make  some  examination  of  old 
line  and  fraternal  life  insurance,  and  I  found  that  for  every  hun- 
dred dollars  paid  to  the  old  line  companies  they  returned  to  their 
policyholders,  in  one  form  or  another,  only  thirty-three  dollars 
out  of  the  hundred.  I  also  found  that  for  every  $42  paid  to  the 
fraternals,  they  returned  to  the  families  and  their  members  $33. 
In  other  words,  old  line  companies  charge  $67,  while  the'  fra- 
ternals charge  only  $7  to  collect  and  pay  their  widows  and  or- 
phans $33. 

In  the  State  of  Ohio,  the  old  line  companies  collected  30  millions 
of  dollars  and  returned  ten  millions.  In  the  State  of  Pennsyl- 
vania, they  collected  $54,000,000  and  returned  $22,000,000.  "in 
Michigan  they  collected  $10,000,000  and  returned  $3,000,000.  In 
Indiana  they  collected  $12,000,000  and  returned  $4,000,000.  Yes, 
we  of  the  fraternal  system  are  thankful  to  you  gentlemen  of  the 
Exposition  for  giving  us  an  opportunity  to  call  to  your  attention  the 


570  WORLD'S  INSURANCE  CONGRESS 

fact  that  we  are  selling  life  insurance  at  actual  cost,  and  in  doing 
so  we  are  teaching  you  that  you  can  have  all  the  life  insurance 
you  desire  or  need  to  protect  those  dependent  upon  you  at  a  cost 
of  about  one-third  what  you  are  now  paying  for  old  line  insur- 
ance. Why  should  business  men  pay  thirty  dollars  for  life  in- 
surance that  costs  only  ten  ?  You  are  entirely  too  sensible,  entirely 
too  wise,  to  pay  $15  for  a  pair  of  shoes  when  you  know  you  can 
buy  them  for  five,  or  pay  fifteen  cents  for  a  pound  of  sugar, 
worth  only  five.  The  mission  of  the  National  Fraternal  Congress 
of  America  is  to  liberate  you  business  men  from  the  heavy  cost  and 
tax  of  life  insurance.  Our  mission  is  to  tell  you  that  "What 
God  charges  for  life  insurance  costs  but  little ;  what  man  charges 
makes  it  so  expensive  as  to  place  it  beyond  the  reach  of  those  who 
need  it  most."  It  was  Goethe,  the  great  German  poet,  who  said: 
"Who  is  the  happiest  man?  He  who  can  rejoice  in  the  success 
of  his  neighbors. ' '  I  take  the  liberty  sometimes  of  modifying  this 
and  asking,  "Who  is  the  greatest  of  men,  as  well  as  the  happiest 
of  men?"  and  I  answer  it  in  the  language  of  the  poet,  "Pie  who 
can  rejoice  in  the  success  of  his  neighbors."  We  of  the  fraternal 
system  rejoice  in  the  success  of  our  old  line  life  insurance  neigh- 
bors. We  do  not  envy  them,  we  bear  them  no  ill  will,  and  we  would 
not  be  unfair  enough  nor  untrue  enough  to  ourselves  to  do  other 
than  rejoice  in  their  success.  But  whatever  may  be  their  success  in 
the  financial  world,  our  fraternal  life  insurance  system  is  moving 
on  with  such  rapid  and  lengthy  strides  that  the  day  is  near  at 
hand  when  our  associations  will  have  demonstrated  to  the  world 
not  only  our  capacity  to  receive  and  distribute  life  insurance  at 
one-third  the  cost  charged  before  we  entered  the  field  of  compe- 
tition, but  also  that  we  are  paying  larger  sums  to  widows  and 
orphans  and  distributing  the  money  to  millions  of  families  who 
would  have  had  no  insurance  at  all  but  for  our  coming  to  them 
and  tendering  them  our  services. 

It  was  Lincoln  who  said :  "I  hope  it  will  be  said  of  me  when 
I  am  dead  and  gone,  by  those  who  knew  me  best,  that  I  always 
plucked  a  thistle  and  planted  a  flower  where  I  thought  a  flower 
would  grow." 

We  of  the  fraternal  system  are  plucking  the  thistles  and  plant- 
ing flowers  for  millions  of  families  where  no  flowers  would  gi'ow 
were  it  not  for  our  insurance. 

There  is  still  one  other  thought  and  I  am  done.  We  of  the 
fraternal  system  are  binding  this  American  Republic  and  even 
the  Dominion  of  Canada  together  with  fraternal  bands  of  sym- 
pathy and  comradeship  that  are  stronger  than  the  steel  bands  that 
stretch  across  our  continent  in  the  service  of  the  great  railway 
systems.  We  are  making  friends  out  of  strangers.  We  are  mak- 
-  ing  comrades,  brothers  and  sisters  in  a  great  continental  house- 
hold. We  are  bringing  to  each  and  every  one  of  our  ten  million 
members  the  groat  wealth  referred  to  by  Emerson,  when  he  said. 
"To  be  rich  in  friends  is  to  be  poor  in  nothing,"  and  we  of  the 


WORLD'S  INSURANCE  CONGRESS       571 

fraternal  system  are  rich  in  friends.  A  grander  manhood  or 
womanhood  never  graced  or  blessed  any  nation,  empire  or  con- 
tinent in  the  history  of  the  world  than  the  fraternal  manhood 
and  womanhood  represented  by  the  National  Fraternal  Congress 
of  America.  AVell  may  we  fraternalists  quote  the  beantifiil 
thought  of  that  great  spiritual,  poetic  soul,  Schiller,  in  saying: 

"If  thou  hast  something,  bring  thy  goods, 
And  a  fair  exchange  be  thine. 
If  thou  art  something,  bring  thy  soul, 
And  intertwine  with  mine." 

Mr.  Lentz  then  introduced  Mr.  W.  L.  Hathaway,  Commissioner 
for  the  "World's  Insurance  Congress  Events  of  the  Panama-Pacific 
International  Exposition,  who  spoke  as  follows: 


ADDRESS  OF  WELCOME 

By  W.  L.  Hathaw^ay 

Commissioner,  AVorld's  Insurance  Congress  Events  of  the  Panama- 
Pacific  International  Exposition 

It  is  signally  fitting  that  the  closing  events  of  Insurance  Week 
should  be  celebrated  by  the  fraternal  orders  of  the  country. 

Fraternity!  The  very  word  itself  is  redolent  of  the  insurance 
idea — the  insurance  spirit.  There  may  be — there  are — many 
classes  of  insurance,  many  methods  by  which  men  are  taught  the 
principles  of  protection,  and  they  all  make  for  better  manhood 
and  a  higher  sphere  of  citizenship ;  they  all  cement  a  little  more 
tightly  the  bonds  that  through  insurance  form  the  great  Brother- 
hood of  Man. 

The  Panama-Pacific  International  Exposition  has  given  insur- 
ance a  place  among  the  arts  and  sciences  never  before  accorded 
it  in  such  an  undertaking,  and  to-day  we  are  not  only  acknowl- 
edging by  your  presence  here  in  such  numbers  the  justice  the  Ex- 
position has  accorded  the  insurance  idea,  but  you  are  helping  to 
spread  the  gospel  of  protection;  you  are,  in  protecting  yourself 
and  your  loved  ones,  carrying  out  the  sacred  injunction  "Bear 
ye  one  another's  burdens."  That  represents  the  basic  idea  of  the 
great  Society  of  the  Insured  that  brings  to  man  the  peace  of 
mind  from  duty  well  done. 

Insurance  by  its  very  force  is  making  a  great  impress  upon  the 
world ;  we  are  attempting  to  give  it  substance,  and  in  these 
demonstrations  which  began  on  Saturday  with  the  "Nine  Years 
After"  celebration,  we  started  on  its  mighty  way  the  message 
of  the  spirit  of  insurance  that  will  find  its  crown  in  the  World's 
Insurance    Congress    in    October,    through    which    we   hope    that 


572  WORLD'S  INSURANCE  CONGRESS 

every  one  interested  in  the  insurance  idea  will  find  common  ground 
on  which  they  can  help  each  other  to  lessen  some  of  the  burdens 
that  a  well-intending  but  frequently  misinformed  public  often 
imposes. 

In  brief,  that  great  Congress,  which  will  deal  with  all  phases 
of  insurance,  and  in  which  fraternals  have  their  due  recognition, 
and  where  we  hope  a  large  delegation  of  the  most  prominent  men 
and  women  of  the  Nation  associated  with  your  societies  will  be 
seated — that  Congress  will  be  the  avenue  through  which  we  will 
invite  the  searchlight  of  public  understanding  of  the  real  social 
service  performed  by  the  insurance  idea,  not  by  any  particular 
branch  of  insurance,  nor  any  particular  way  of  conducting  it. 
That  is  the  concern  of  each  individual  company,  society  or  other 
unit  under  which  people  seek  various  forms  of  protection,  and  it  is 
not  the  purpose  of  the  meetings  held  under  these  Exposition 
auspices  to  exploit  any  of  those  fractional  ideas  which  are  legiti- 
mate matters  for  competition  between  men  in  the  busy  activities 
of  life.  It  is  rather  our  purpose  to  give  all  of  those  interested  in 
the  subject  of  insurance  from  its  broadest  conception  an  oppor- 
tunity to  educate  the  public  mind  regarding  the  part  that  insur- 
ance plays  in  the  entire  social  scheme  of  things. 


Following  Mr.  Hathaway,  M.  G.  O'SIally,  member  of  the  Su- 
preme Board  of  Directors  of  the  Fraternal  Brotherhood,  of  Port- 
land, Oregon,  spoke  in  the  stead  of  Mrs.  Emma  R.  Neidig,  Supreme 
President  of  the  Order.    Mr.  O'Mally's  address  was  as  follows: 


ADDRESS  OF  WELCOME 

By  M.  G.  O'Mally  for  Mrs.  Emma  R.  Neidig 
Supreme   President,   The   Fraternal   Brotherhood 

I  am  but  newly  come  among  the  people  of  San  Francisco  and 
have  many  things  to  learn.  AVhen  I  speak  about  your  people  and 
your  City  I  am  more  or  less  at  a  disadvantage.  But  even  in  my 
short  stay  there  are  some  things  that  I  have  found  out.  I  know, 
for  instance,  that  I  must  never,  this  side  of  Oakland,  call  your 
City  "Frisco"  but  always  San  Francisco,  lest  I  somehow  wound 
some  one's  civic  pride.  I  have  had  it  thoroughly  impressed  on  me 
that  you  did  not  have  an  earthquake  here,  but  a  fire.  I  have 
visited  Mission  Dolores  and  know  that  the  first  Spaniard,  or  one 
of  the  first,  to  be  buried  there  bore  the  name  of  Patrick  IMurphy, 
and  came  from  the  County  of  Cork.  Likewise.  I  know,  and  I 
must  tell  you  about  it  since  I  learned  this  elsewhere,  that  San 
Francisco  is  one  of  the  best  beloved  cities  in  America  to-day,  and 
that  even  far  beyond  the  confines  of  this  Nation,  yes,  oven  in  the 
uttermost  parts  of  the  earth,  there  are  countless  hundreds  who 


WORLD'S  INSURANCE  CONGRESS  573 

speak  the  name  of  your  City  with  affection  and  wish  for  her  all 
the  success  and  happiness  that  is  her  due. 

The  ancient  world  of  myth  and  fable,  with  its  enchantments, 
its  marvels,  its  miracles,  its  giants  and  its  ogres,  which  many  mat- 
ter-of-fact people  declare  never  existed,  is  with  us  to-day  as  fresh 
and  as  fervent  as  it  was  in  the  very  childhood  of  the  race.  Every 
marvel,  every  monster,  every  miracle  of  the  past  has  its  present- 
day  counterpart. 

That  fiery  dragon  that  roamed  the  earth  in  St.  George's  day 
with  flaming  eyes,  and  smoking  nostrils,  is  so  far  outdone  by  his 
present-day  prototype  that  he  would,  if  he  were  alive  to-day,  put 
his  tail  between  his  legs  and  give  the  road,  in  fear  and  trembling, 
to  the  modern  gasoline  motor  car,  as  we  do. 

Those  fabulous  birds,  the  beating  of  whose  gigantic  wings  was 
like  unto  the  oncoming  rush  of  the  hurricane,  who  soared  aloft 
into  the  ether  with  human  beings  clutched  in  their  talons,  are 
not  unfittingly  represented  to-day  by  the  aeroplanes  that  circle 
about  us.     Surely  their  credited  toll  of  human  life  is  no  greater. 

Those  voracious  monsters  of  the  ancient  deep  who  consumed 
whole  boats  at  a  single  gulp  never  left  such  a  trail  of  destruction 
in  their  paths  as  do  the  modern  submarine  or  torpedo  boats. 

The  flying  Mercury  of  mythologj"  would  be  but  a  cripple  for 
speed  when  compared  with  our  modern  means  of  locomotion. 

The  most  leathern-lunged  stentorian-voiced  god  in  the  whole 
galaxy  could  not,  though  he  shouted  ever  so  loudly,  make  his  voice 
carry  from  San  Francisco  to  New  York  as  we  do,  without  effort. 

The  physical  charms  of  our  modern  goddesses  (who  include 
the  whole  feminine  sex)  far  outshine  Venus  and  Diana,  and  be- 
sides they  are  not  half  as  cruel  as  either. 

Jupiter  with  his  thunderbolt  and  Thor  with  his  hammer  are  but 
sorry  spectacles  when  compared  with  little  Fraulein  Krupp  and 
her  sixteen-inch  gun. 

]\Iars,  the  god  of  ancient  war,  is  but  a  cheap  assassin  when  com- 
pared with  our  present  day  Czar,  Emperor  and  King. 

Atlas,  with  the  world  on  his  back,  would  be  rated  as  a  corner 
loafer  if  we  but  compared  the  load  he  carried  with  that  now 
borne  by  President  "Wilson. 

Thus  far,  I  have  not  been  able  to  think  of  any  modern  character 
who  overshadows  Hercules,  but  may  we  not,  at  least,  hope  that 
Jess  Willard  will  develop  with  age? 

That  famous  giant  of  our  nursery  days  who  "smelt  the  blood 
of  an  Englishman"  and  ate  little  children  was  a  monstrous,  re- 
pulsive creature  it  is  true.  We  all  heaved  a  sigh  of  relief,  I  am 
sure,  when  we  learned  that  Jack  cut  down  the  bean  stalk  and  rid 
us  forever  of  that  particular  ogre. 

And  yet  the  giant  Jack  so  valiantly  disposed  of  was  but  a  tiny 
glow-worm  beside  the  sizzling  white  hot  sun  when  compared  with 
the  greatest  of  the  modern  giants,  the  present  day  Moloch,  whose 
name  is  Industry  and  whose  god  is  Profit. 


574       WORLD'S  INSURANCE  CONGRESS 

Jack's  giant  consumed  little  children  by  ones  and  twos.  Our 
present  day  monster  consumes  them  by  thousands  and  tens  of 
thousands.  He  consumes  their  intelligence,  their  vitality,  and 
their  manhood,  and  coins  it  all  into  medals  of  Mammon,  the  Dol- 
lars of  connnerce.     And  he  does  not  stop  at  children,  either. 

Even  our  brave  little  giant-killer  has  his  modern  prototype, 
his  present  day  emulator.  We  find  the  modern  Jack  in  legislative 
halls  where  restrictive  laws  designed  to  curb  the  appetite  of  our 
giant  are  under  way.  In  this  connection  I  am  reminded  that  one 
of  these  restrictive  laws  has  been  passed  by  a  great  Southern  State. 
It  is  called  the  "Baby  Labor  Law"  and  prohibits  the  employment 
of  children  under  nine  years  of  age. 

Wlienever  I  think  of  South  Carolina's  Baby  Labor  Law,  I  am 
somehow  always  reminded  of  the  fact  that  in  some  localities  there 
is  an  ordinance  prohibiting  the  killing  of  calves  for  veal  until  they 
are  three  weeks  old.  Such  ordinances,  I  am  told,  have  a  marked 
effect  in  improving  the  quality  of  veal,  but  do  not  add  to  the 
preservation  of  the  calves. 

Turning  again  to  more  pleasant  comparisons  between  ancient 
and  modern  times  we  are  reminded  that  in  the  imagination  of  the 
ancients  there  existed  a  most  wonderful  bird  called  the  Phoenix, 
which,  being  consumed  by  fire  through  its  own  act,  rose  again 
from  the  ashes. 

To-day  we  celebrate  the  birth,  growth,  and  development  of  a 
modern  Phoenix,  the  City  of  San  Francisco. 

Nine  years  ago  the  Fire  God  held  almost  undisputed  sway 
across  these  broken  hills.  Grim  Want  sat  on  almost  every  door- 
step. 

The  labors,  the  accumulations  of  a  mighty  people,  covering  ; 
period  of  more  than  half  a  centuiy,  were  wrapped  in  a  mantle  of 
flame  and  smoke,  and  went  roaring  back  to  the  Infinite. 

A  cry  of  pity,  a  wave  of  sympathy,  swept  round  the  world. 
"San  Francisco  is  doomed,"  were  the  words  on  every  tongue. 
"San  Francisco  can  never  be  rebuilt,"  Avas  the  sad  prediction  of 
every  curbstone  prophet.  But  these  oracles  of  woe  and  disaster 
reckoned  without  taking  into  account  the  spirit  of  the  San  Fran- 
cisco people. 

The  greatest  calamity  that  can  overtake  a  city  or  a  people  is 
not  fire  or  flood.  It  is  not  pestilence.  It  is  not  famine.  The 
greatest  calamity  that  can  come  to  any  man  or  set  of  men  is  to 
lose  faith  in  one's  self.  San  Francisco  never  lost  that.  As  a 
result  of  her  undying  faith,  her  unfaltering  energ>\  her  bound- 
less determination,  we  have  here  once  more  a  great  City,  more 
permanent,  more  capable  and  perhaps  fairer  than  ever  before. 

A  keen  observer  has  said  that  San  Francisco  is  not  so  much  a 
matter  of  geographical  location  as  it  is  a  state  of  mind.  It  is  not 
so  much  a  city  as  it  is  a  spirit.  Like  the  realm  of  Bohemia  which 
so  many  seek  for  and  never  find,  it  exists  only  within  ourselves. 

Many  there  are  among  you,  I  am  told,  who  spend  nil  thr'w  lives 


AVORLD'S  INSURANCE  CONGRESS  575 

from  the  cradle  to  the  grave  within  the  limits  of  this  City  that 
sits  so  grandly  keeping  watch  and  ward  beside  the  Golden  Gate, 
and  who  go  down  to  their  tombs  without  ever  having  set  their  feet 
within  the  portals  of  the  real  San  Francisco.  For,  be  it  known, 
the  real  San  Francisco  is  a  mystic  city  builded  out  of  the  most 
priceless  possession  of  the  old  Argonauts;  builded  out  of  the 
aspirations  and  the  dreams  which  lured  those  Jovian  men  from 
their  early  moorings  and  lashed  them  round  the  earth  here  to 
foregather,  by  chance  at  last,  seeking,  ever  seeking,  their  particu- 
lar pot  of  gold  at  the  rainbow's  end.  Fire  cannot  injure  the  real 
San  Francisco.  It  will  live  as  long  as  the  spirit  of  your  sires.  It 
will  live  in  the  minds  and  the  hearts  of  men  as  long  as  hope  and 
joy   and   chivalry   find   a  place   among  your  people. 

In  the  days  when  your  fair  City  was  lying  shattered  and  bleed- 
ing, when  Ruin  stalked  abroad  with  unfettered  feet,  trampling  on 
the  hearts  of  your  citizens  at  every  stride,  it  is  a  matter  of  much 
pride  to  the  members  of  the  society  I  represent.  The  Fraternal 
Brotherhood,  to  remember  that  it  was  one  of  our  people,  a  member 
of  our  Executive  Board,  who  first  brought  outside  money  to  the 
aid  of  your  stricken  people.  That  man,  as  many  of  you  know, 
was  Motley  H.  Flint,  of  Los  Angeles. 

Postmaster  of  his  home  town  when  the  news  of  the  San  Fran- 
cisco disaster  came  to  him,  he  paused  not  to  ask  about  the  how,  the 
why  or  the  where,  but  seizing  a  pad  of  postal  money  orders,  he 
sprang  into  a  coach  and  came  to  your  relief  as  fast  as  steam 
could  carry  him.  He  risked  his  private  fortune  that  he  might 
do  good.  All  honor  to  Motley  Flint,  Supreme  Trustee  of  The 
Fraternal  Brotherhood.  Of  such  as  he  is  the  kingdom  of  Fra- 
ternity. 

It  is  likewise  a  source  of  satisfaction  to  The  Fraternal  Brother- 
hood to  remember  that  the  members  of  that  society  levied  a  spe- 
cial assessment  on  themselves  and  paid  the  dues  of  San  Francisco 
for  one  year  in  advance. 

Insurance  has  played  a  vital  part  in  the  rebuilding  of  San 
Francisco.  Again  it  is  a  source  of  satisfaction  to  us  to  remember 
that  The  Fraternal  Brotherhood  and  every  other  fraternal  so- 
ciety paid  one  hundred  cents  on  the  dollar  on  every  death  loss. 

To-day  I  enjoy  the  highest  distinction  that  can  come  to  any 
man,  that  of  representing  a  good  and  pure  woman.  I  am  here  as 
the  representative  of  Mrs.  Emma  R.  Neidig,  the  Supreme  President 
of  The  Fraternal  Brotherhood,  to  which  I  have  referred. 

If  it  can  be  fittingly  said  of  men  who  rise  spiritually  above  their 
fellows  that  they  are  "a  little  nearer  the  angels"  then  it  can  be 
truly  said  of  womankind  that  they  stand  right  at  the  very  Throne 
of  Grace. 

"There's  not  a  cry  from  earth  to  Heaven, 
There's  not  a  prayer  for  mercy  given 
But  has  a  woman  in  it." 


576  WORLD'S  INSURANCE  CONGRESS 

I  cannot  fittingly  represent  her  whom  I  am  sent  to  serve.  I  can 
only  stand  here  and  give  you  a  little  of  the  message  of  love  and 
confidence  which  she  has  for  every  human  being,  and  which  she 
has  bestowed  in  unstinted  measure  on  those  who  have  had  the 
good  fortune  to  sit  at  her  feet.  If  there  is  aught  of  faith,  of 
love,  of  admiration,  of  confidence  in  my  words  to-day,  then  these 
things  are  all  from  her.  I  am  merely  her  dispatch  bearer.  If  I 
have  failed  to  convey  to  you  any  of  these  sentiments  the  fault 
lies  in  my  lack  of  expression,  and  in  the  further  fact  that  it  is 
not  given  to  man  to  faithfully  interpret  the  feelings  of  a  woman. 

We  are  met  to-day  to  honor  Fraternalism — human  Brotherhood. 
Eminent  men  have  gathered  from  all  parts  of  the  Nation.  Lofty 
sentiments  have  been  expressed  by  them.  The  police  march  with- 
out their  clubs  in  honor  of  the  spirit  of  the  day.  We  are  told 
of  the  mighty  work  that  has  been  done  in  the  cause  of  human 
Brotherhood,  of  the  great  societies  that  have  been  born,  all  dedi- 
cated to  a  grand  principle.  Great  praise  has  been  given  these 
agencies  that  have  striven  and  are  striving  for  human  betterment. 
Who  shall  say  that  such  praise  is  not  deserved?  We  have  not 
attained  the  millennium  it  is  true.  Some  of  us  forget  the  mission 
to  which  we  have  pledged  ourselves.  Some  loiter  on  the  way  and 
some  become  discouraged  and  turn  back.  When  one  considers  the 
obstacles  that  Fraternalism  has  had  to  encounter,  the  wonder  is  not 
that  it  has  done  so  much. 

Since  the  days  when  Cain  struck  down  his  brother,  envy  and 
jealousy  have  played  their  parts  in  the  affairs  of  life.  Cupidity 
has  held  sway  since  long  before  the  days  when  Jacob  showed  his 
knowledge  of  prenatal  influences  and  peeled  the  willows  in  order 
to  control  the  color  of  the  sheep  of  his  father-in-law.  Treachery 
was  born  long  before  Judas  betrayed  his  Master.  Nineteen  hun- 
dred years  of  the  teachings  of  the  Christ  doctrine,  confronted  as  it 
is  with  an  industrial  system  based  on  profit,  stands  baffled  and 
beaten  while  the  Golden  Rule  has  been  paraphrased  into  "Do 
others  or  thev  will  do  you,"  and  as  David  Harum  says,  "Do  'em 
fust." 

If  Fraternalism  has  been  unable  to  work  a  change  in  the  heart 
of  Man  we  need  not  be  discouraged  nor  yet  repine.  At  least  it  has 
smoothed  the  brow  of  care  and  held  the  kindly  glass  of  water  to 
parched  and  fevered  lips.  It  has  rejoiced  with  the  gay,  and 
mourned  with  the  desolate.  It  has  lifted  the  mortgage  from  the 
little  home,  clothed  and  fed  the  widow  and  orphan.  It  has  kept 
the  little  boy  from  the  gutter,  and  the  little  girl  from  the  factory 
or  shop  before  her  time.  It  has  brought  education  within  the  reach 
of  those  who  would  otherwise  have  been  denied  its  blessings.  These 
things  it  has  already  done.  If  it  should  do  no  more  it  is  at  least 
worthy  of  having  lived.  It  would  still  be  entitled  to  the  apprecia- 
tion and  the  support  of  every  man  who  loves  liis  fellow-men. 

But  the  mission  of  Fraternalism  is  not  ended.  As  time  goes 
by  its  scope  will  broaden  rather  than  narrow.    As  the  obstacles  to 


WORLD'S  INSURANCE  CONGRESS  577 

a  sane  economic  relation  are  removed,  and  the  mind  and  the  heart 
of  ]\Ian  are  given  an  opportunity  to  develop,  naturally  there  will 
come  a  day  when  it  can  be  truly  said  that  "All  men  are  brothers" 
in  tlie  broadest  sense.  When  that  comes  the  mission  of  Fraternity 
will  be  ended,  and  not  till  then. 

And  now  as  the  representative  of  a  California  society,  of  a  west- 
ern society,  may  I  not  bid  you  welcome  to  the  Pacific  Coast?  In 
California  you  will  find  the  playground  of  the  ancient  gods,  in 
Oregon  the  land  of  the  fairies,  and  in  Washington  you  will  find 
the  land  of  the  Superman.  To  each  and  all  of  these  localities  I 
bid  you,  in  the  language  of  my  forefathers,  "Caed  Mille  Failthe," 
which  means  One  Hundred  Thousand  Welcomes. 


Mrs.  Frances  E.  Burns,  Grand  Commander  of  the  Ladies  of  the 
Modern  Maccabees,  then  delivered  the  following  address: 


ADDRESS 

By  Mrs.  Frances  E.  Burns 
Great  Commander,  Ladies  of  the  Modern  Maccabees 

The  Panama  Canal  is  one  of  the  world's  greatest  achievements 
for  the  benefit  of  man,  and  it  is  said  that  in  this  great  celebra- 
tion of  its  completion,  only  the  best  of  each  art  and  craft  is  to  be 
exhibited,  and  therefore  it  is  most  fitting  that  the  great  fraternal 
system  should  take  its  place  here  among  the  other  great  achieve- 
ments of  the  age,  and  that  we  should  turn  our  eyes  to  one  of  its 
agencies,  which  in  the  last  fifty  years  has  given  the  acme  of  assist- 
ance to  our  people.  In  the  recent  war  loans,  all  world's  records 
have  been  surpassed,  and  when  Germany  sold  one  and  one-fourth 
billions  of  these  bonds  almost  entirely  to  her  own  people,  the 
press  teemed  with  this  great  fact;  later  England  surpassed  this 
record  when  her  issue  of  one  and  three-fourths  billions  was  speed- 
ily taken  up ;  then  came  Germany  with  another  bond  sale  of  two 
and  one-half  billion  dollars,  and  correspondents  were  scarce  able 
to  find  words  fittingly  to  express  to  the  public  this  great  fact, 
and  repeatedly  we  read  that  even  servants  and  newsboys  invested 
their  tiny  hoards  as  the  bonds  were  issued  in  such  small  denomina- 
tions that  it  was  made  possible  for  them  to  become  purchasers,  and 
their  devotion  to  their  country  was  so  great  that  they  considered  it 
a  patriotic  duty.  But  I  come  to  you  with  a  greater  marvel — two 
and  one-half  billions  of  dollars  expended  by  the  great  frato:  nal 
system,  not  for  shot  and  cannon,  aeroplanes  and  submariji^s, 
wrecked  homes  and  murdered  men,  but  for  shoes  and  stockings  for 
tiny  feet,  school  books  in  the  small  hands,  home  ties  knit  together 
under  a  roof  from  which  the  mortgage  has  been  lifted,  new  life 
through  hospital  and  sanitarium  for  those  who  are  ill  and  needy 


578  WORLD'S  INSURANCE  CONGRESS 

— in  short  two  and  one-half  billion  dollars  spent  for  peace  and 
happiness,  rather  than  two  and  one-half  billion  dollars  for  war  and 
destruction.  Newspaper  men  stand  up,  look,  and  herald  this  fact 
to  the  ends  of  the  earth,  that  the  disbursement  of  the  fraternal 
system  in  the  last  fifty  years  equals  Germany's  great  war  loan, 
the  greatest  ever  made  in  the  history  of  the  world,  and  that  every 
dollar  has  gone  to  relieve  suffering  and  not  to  create  it.  So  quietly 
and  persistently  has  the  great  work  gone  on,  that  it  is  like  the 
gentle  rain  dropping  from  heaven  to  earth,  and  enlivening  all 
whom  it  touches,  and  its  deeds  are  no  more  to  be  counted  than 
are  the  rain  drops  greedily  swallowed  by  the  thirsty  earth,  but 
new  heart,  new  hope,  new  life  ever  follow  in  its  train,  for  it  is 
but  a  daily  and  hourly  exemplification  of  the  great  Master's  teach- 
ing— the  cup  of  cold  water,  the  helping  hand  to  the  afflicted,  suc- 
cor to  the  needy  and  distressed. 

The  cost  of  the  great  Canal  we  are  told  is  four  hundred  million 
dollars.  It  will  revolutionize  trade,  commerce,  and  travel,  and 
will  give  increased  service  to  millions  of  people.  Its  completion 
is  so  great  an  event  in  the  world's  history,  that  all  nations  have 
flocked  to  our  shore  to  do  us  honor — two  great  Expositions  have 
been  created  to  signalize  the  greatest  engineering  conquest  of  the 
age,  yet  the  disbursements  already  made  by  the  fraternal  system 
w^ould  have  built  more  than  six  Panama  Canals — truly  it  is  only 
by  comparison  that  we  can  fully  realize  the  great  work  already 
accomplished,  and  that  mapped  out  for  the  future  where  ten  bil- 
lion dollars  worth  of  certificates  will  mature  and  this  great  flood 
of  money  will  flow  in  a  continuous  stream  day  and  night  into  the 
homes  of  its  members.  What  have  women  had  to  do  with  this 
vast  problem  and  its  wonderful  disbursements? 

The  record  of  women  in  fraternity  is  really  the  history  of  the 
race,  as  it  has  always  seemed  to  be  woman's  mission  from  the 
cradle  to  the  grave  to  minister  to  the  wants  and  needs  of  others. 
For  centuries  she  served  blindly,  only  seeking  by  ever  more  ardu- 
ous endeavor  to  feed  the  hungry,  clothe  the  naked  and  minister  to 
the  sorrowful.  Ever  as  she  labored  came  the  realization  of  the 
inadequacy  of  private  or  public  charity,  both  of  which  pauperized 
the  person  whom  it  was  intended  to  help.  The  more  progressive 
vision,  as  the  years  advanced,  clearly  showed  that  the  old  adage 
of  "An  ounce  of  prevention  is  worth  a  pound  of  cure"  is  doubly 
trne  of  all  relief  work.  Organization  was  needed,  and  the  great 
principle  of  cooperation  must  be  invoked.  Quietly  and  simply 
one  line  of  work  after  another  to  counteract  existing  evils  was 
taken  up.  The  Woman's  Christian  Temperance  Union  to  battle 
against  the  hydraheaded  monster  of  the  liquor  traffic;  the  Red 
Cross  to  alleviate  the  suffering  and  excessive  death  rate  in  war 
and  national  calamities;  the  National  Suffrage  Association  to  edu- 
cate the  people  upon  equal  suffrage ;  the  INIothers'  Congress  to  teach 
and  conserve  all  infant  life;  the  great  peace  organizations  to  bring 
the  world  to  a  realization  of  the  immense  benefits  to  be  gained  by 


WORLD'S  INSURANCE  CONGRESS       579 

disarmament  and  arbitration;  the  Florence  Crittenton  Mission  to 
help  save  our  unmarried  girls;  the  Federation  of  Women's  Clubs 
to  study  civics  as  well  as  literature;  the  National  Council  of 
Women  to  bring  together  all  lines  of  organized  women's  activities 
and  dozens  of  other  organizations  of  women  physicians,  nurses, 
lawyers,  ministers,  clerks,  stenographers,  farmers'  wives,  box  mak- 
ers, shirt  waist  makers,  etc., — all  sprang  one  after  another  into 
existence  each  bringing  its  agencies  to  bear  upon  the  solution  of 
the  great  human  problem.  This  great  massing  and  grouping  of 
women  which  has  taken  place  in  the  last  fifty  years  betokens  three 
things : 

First — All  women  now  recognize  the  nobility  of  work  and  the 
worker. 

Second — The  greatly  accentuated  sjanpathy  and  good-will  of 
women  toward  each  other. 

Third — The  more  intelligent  use  of  their  powers  in  all  philan- 
thropic and  industrial  undertakings. 

Is  it  strange  that  as  the  weaving  went  out  of  the  home  and 
the  sewing  machine  came  in,  as  the  colleges  swung  wide  their 
closed  portals  to  women,  and  on  every  side  new  activities,  new 
lines  of  thought  and  new  research  into  untrodden  paths  were  un- 
dertaken, that  the  great  idea  of  cooperative  protection  should 
have  claimed  their  attention?  There  were  a  few  orders  of  men 
engaged  in  this  work,  but  it  was  still  in  a  crude  state  when  Mrs. 
Adelphia  G.  Ward,  the  first  woman  clerk  in  Marshall  Field's 
Chicago  department  store,  on  March  24,  1886,  called  together  nine 
women  in  her  home  in  Muskegon,  Michigan,  and  formed  the  first 
woman's  fraternal  benefit  association  for  help  in  sickness  and 
death  and  protection  of  the  dependent  ones  left  thereby.  From 
that  little  circle  the  work  has  broadened  and  spread  to  thousands 
of  women  and  from  the  modest  cottage  in  one  city  to  every  city 
and  hamlet  and  crossroads  in  the  United  States.  For  shortly 
after  came  one  by  one  other  women's  Orders,  until  now  ten  ex' 
clusively  women's  Orders  cover  the  United  States  with  a  network 
of  lodges  and  activities.  They  have  over  a  million  members  with 
outstanding  protection  of  $817,260,461,  and  they  have  disbursed 
in  death,  disability,  old  age  and  maternity  benefits  $65,606,666, 
sums  so  vast  that  when  a  report  of  this  work  was  made  in  the 
great  International  Council  of  Women,  where  the  representatives 
of  twenty-five  nations  of  the  world  gathered,  the  Countess  of  Aber- 
deen, the  presiding  oificer,  stopped  the  speaker  and  said.  "You 
mean  this  is  done  by  your  government,  madam,"  to  which  the 
President  from  the  United  States  answered,  "No,  not  our  govern- 
ment. This  money  is  collected  and  disbursed  and  this  work  is 
done  by  the  women  of  our  land,  alone,  unaided  by  men  or  by  the 
government."  The  scope  of  these  Orders  can  be  determined  by 
their  needs  which,  can  all  be  summed  up  in  four  small  words — 
"Protection  for  the  Home."  The  great  ideal  is  to  make  the  home 
a  place  to  be  glad  in,  a  place  to  be  safe  in,  a  place  to  grow  strong 


580  WORLD'S  INSURANCE  CONGRESS 

in,  a  refuge  from  heat  and  cold  and  all  ills,  a  place  of  protection 
for  the  wee  ones  or  the  weak  ones  who  must  be  sheltered  from 
life's  blasts,  and  to  insure  the  perpetuity  of  that  dear  spot  even 
if  death  should  invade  and  snatch  away  the  strong  arm  of  its 
provider  and  defender.  So  in  this  cooperative  society  there  must 
be  taught  and  practised  the  great  insurance  principle — the  law 
of  averages — so  that  where  a  mortgage,  sickness  or  death  might  be 
far  too  heavy  a  burden  for  one  alone,  when  divided  among  a  thou- 
sand it  would  be  but  lightly  felt;  and  so  a  death  benefit  of  from 
one  to  five  thousand  dollars  was  incorporated  and  fixed  payments 
upon  the  part  of  the  members  must  be  made  to  equalize  the  re- 
sponsibility. Disability  benefits  were  added,  that  a  person  to- 
tally and  permanently  disabled  might  receive  financial  relief  to 
assist  her  in  securing  needed  medical  treatment  and  to  furnish 
support  while  she  is  disqualified  from  performing  her  usual  avoca- 
tion. Old  age  benefits  were  added  to  give  her  independence  in. 
her  declining  years;  a  maternity  benefit  to  bring  medical  care 
and  nursing,  surcease  from  household  duties  until  the  new  life  is 
fully  established ;  hospital  beds  to  care  for .  the  grievously  sick 
unable  to  help  themselves.  Truly  to  every  line  of  human  need  do 
these  great  sisterhoods  reach  out  their  helpful  hands.  Around  this 
center  has  been  collected  a  vast  and  varied  force  of  moral  reform, 
all  forms  of  education,  of  innocent  amusements  and  health-giving 
sports,  all  made  vitally  effective  for  personal  uplift  by  the  life 
blood  of  personal  service. 

The  business  development  of  these  Orders  may  be  divided  into 
financial,  legal  and  administrative.  The  financial  department 
deals  with  thousands  of  dollars  collected  and  disbursed  and  great 
care  and  knowledge  are  necessary  in  the  banking  of  these  funds. 
Investments  must  be  carefully  considered  both  from  the  stand- 
point of  yield  in  revenue  and  safety  for  the  future.  The  bond 
market  must  be  diligently  studied  if  the  investments  are  to  be 
carefully  and  properly  made.  The  auditing  of  funds  of  nearly 
all  fraternal  orders  is  carried  on  both  in  the  subordinate  lodges 
and  in  the  grand  lodges.  The  legal  rights  of  the  members  receive 
careful  study  and  attention.  The  rights  of  the  Order  also  re- 
quire exhaustive  research;  from  time  to  time  it  is  necessary  to 
defend  the  rights  of  the  Order  in  the  courts,  as  against  falsification 
as  to  age  and  admission,  physical  condition,  or  violation  of  con- 
tract. The  legislative  work  must  be  looked  after  in  each  State 
at  every  session  of  the  asseinbly,  that  itew  or  unwise  legislators 
may  not  be  misled  into  drafting  laws  which  would  strike  at  the 
foundation  of  the  structure  of  this  great  work.  Administrative 
work  must  be  first  considered  in  the  general  office,  its  great  force 
of  clerks,  its  necessary  system  and  efficiency — for  like  all  large 
machines  it  will  bear  frequent  oiling  and  adjustment.  Each  order 
has  a  large  field  force,  in  many  instances  from  fifty  to  one  hun- 
dred and  fifty  deputies,  for  whom  work  must  be  planned  in 
detail,  expenses  carefully  watched,  that  the  funds  of  the  Order 


WORLD'S  INSURANCE  CONGRESS       581 

shall  be  properly  conserved — its  lodge  branches  must  be  built  up 
to  the  highest  plan  of  work,  from  both  the  standpoint  of  relief 
and  social  purpose. 

The  subordinate  lodges  are  usually  grouped  in  county  and 
State  associations,  holding  frequent  mLetings,  for  the  promulgation 
of  new  plans,  coordination  of  the  work,  and  above  all  for  social 
intercourse.  National  meetings  are  also  held,  bringing  together 
State  bodies,  adopting  laws,  plans  of  procedure,  electing  officers 
to  care  for  future  work.  All  of  the  great  fraternal  societies  are 
again  gathered  into  the  National  Fraternal  Congress  of  America, 
which,  while  a  purely  advisory  body,  nevertheles.s  has  come  to 
be  a  peacemaker  for  all  fraternities ;  hence  it  will  be  seen  that 
every  part  of  this  work  from  the  fraternal  lodge  to  the  Fraternal 
Congress  of  America,  necessitates  daily  growth  and  development, 
and  it  is  a  proud  boast  of  women's  Orders  that,  in  the  highly 
specialized  lines  of  valuations  and  annual  reports,  they  have  been 
able  to  hold  their  orders  to  equal  efficiency  and  service  with  those 
managed  and  officered  by  men. 

In  the  past,  woman  during  life  and  strength  protected  her  home 
by  personal  supervision,  now  she  has  learned  how  to  extend  that 
protection  beyond  the  grave.  No  longer  is  her  ability  questioned 
in  business  or  financial  circles.  Everv^where  we  find  women  at 
the  front  in  great  business  organizations.  It  is  said  there  are 
80,000  women  stockholders  in  the  U.  S.  Steel  Corporation.  "The 
greatest  questions  of  the  day,"  says  Norman  Hapgood,  "are  the 
questions  of  housekeeping — economy,  morals  and  health.  The 
home  now  is  not  bounded  by  four  walls,  it  is  everywhere,  and 
women's  place  is  in  the  home.  The  call  of  the  present  is  towards 
the  working  out  the  ideals  of  the  whole  race,  not  a  part  of  it. 
Can  any  one  doubt  that  in  the  search  for  human  happiness,  woman 
should  have  an  equal  part  with  man  ? ' ' 


Hon  AYilliam  Koch.  Grand  Foreman  of  the  Brotherhood  of  Amer- 
ican Yeomen,  spoke  briefly  on  the  benefits  of  insurance  and  the 
reasons  for  fraternal  insurance.  Hon.  J.  D.  Clark,  Supreme  Vice 
Chief  Ranger  of  the  Independent  Order  of  Foresters,  also  spoke, 
giving  a  vivid  description  of  the  1906  catastrophe  in  San  Fran- 
cisco from  his  experience  there  as  a  visitor  at  the  time  and  telling 
how  the  fraternals  aided  in  the  work  of  relief. 

The  celebration  of  the  above  mentioned  four  days,  together  with 
the  regular  annual  meeting  of  the  Fire  Underwriters'  Association 
of  the  Pacific,  also  referred  to  above,  and  a  conference  of  the 
Pacific  Division  of  the  Royal  Indemnity  Company,  which  drew 
a  number  of  department  heads  and  others  connected  with  that 
Company  in  the  West,  rounded  out  the  first  week  of  insurance 
events  of  the  Exposition.  Following  that  first  week,  and  up  to  the 
opening  of  the  World's  Insurance  Congress  itself  on  October  4th, 


582  WORLD'S  INSURANCE  CONGRESS 

insurance  conventions  large  and  small  gathered  in  San  Francisco. 
Many  of  them  were  of  such  size  and  importance  as  to  justify  the 
Exposition  in  awarding  special  days  for  their  benefit. 


EXHIBITS 

Aside  from  the  various  insurance  events  above  chronicled,  and 
the  many  which  followed  in  the  interim  between  April  and  October 
of  1915,  there  were  installed  in  the  Exposition  palaces  over  three 
hundred  exhibits  in  some  manner  emphasizing  the  part  which  in- 
surance has  played  in  fire  prevention,  health  conservation  and  all 
protective  work  which  tends  to  promote  better  and  safer  living 
conditions  and  consequent  longevity;  and  these,  for  the  first  time 
in  the  history  of  expositions,  were  classified  under  the  head  of 
Social  Economy,  and  displayed  in  connection  with  that  science.  A 
complete  list  of  all  which,  in  any  way,  pertained  to  insurance 
here  is  given : 

Insurance  Companies  * 

jEttm  Life  Insurance  Company,  Hartford,  Conn.,  Palace  of 
Mines. — Electrically  operated  machines,  showing  application  of  de- 
vices to  prevent  accident;  still  exhibits  illustrating  safety;  charts 
and  statistics  of  preventable  accidents;  stereomotorgraph ;  models. 
The  exhibit  of  the  ^Etna  Life  also  embraced  the  Jiltna  Accident 
and  Liability  of  Hartford,  and  the  Automobile  Insurance  Com- 
pany of  Hartford,  under  the  same  management. 

Hartford  Fire  Insurance  Company,  Hartford,  Conn.,  Palace  of 
Mines. — Stereomotorgraph;  signs  illustrating  accident  and  advan- 
tages of  insurance;  relic  of  "Hartford"  sign  that  passed  through 
conflagration  of  1906;  cubes  showing  losses  paid;  souvenir  medal 
distributed. 

Maryland  Casualiy  Company,  Baltimore,  Md.,  Palace  of  Mines 
— Model  of  company's  home  office  building  and  statistics  showing 
growth  and  value  of  Insurance. 

Metropolitan  Life  Insurance  Company  of  New  York,  Palace  of 
Mines. — Exhibit  of  welfare  work  for  policyholders  and  employees. 
Outlined  various  measures  for  safeguarding  health  of  over  ten  mil- 
lion policyholders  and  seventeen  thousand  employees.  Charts  and 
photographs  in  one  division  described  the  visiting  nurse  service, 
the  Health  and  Happiness  League,  the  company's  publications  on 
hygiene  and  various  forms  of  cooperation  with  health  officers  and 
other  civic  and  social  agencies.  The  charts  in  the  second  division 
outlined  the  company's  policy  with  reference  to  luncheons  for 
employees,  the  Staff  Savings  Fund,  the  educational  activities, 
working  conditions,  and  other  features  which  operate  most  suc- 

*  'J'lu!    insurance   companips   exliihitins:    in    the    Colloctivo    Insurance   and 
Universal  Safety  Exhibit  are  not  included  in  this  list  but  are  found  on  page 

588. 


WORLD'S  INSURANCE  CONGRESS  583 

cessfully  in  developing  an  efificient  and  satisfied  working  staff. 
Rest  room  for  visitors. 

Prudential  Insurance  Company  of  America,  Newark,  N.  J.,  Pal- 
ace of  Mines. — Elaborate  scientific  display  by  means  of  320  charts, 
divided  into  nine  groups,  showing  methods  and  achievements  of 
company;  its  mortality  experience;  mortality  in  Western  Hemis- 
phere ;  public  health ;  insurance  history ;  practice  in  life  insurance 
throughout  the  world ;  Gibraltar  and  its  history ;  models  of  Gibral- 
tar home  office  buildings. 

Bossia  Insurance  Company,  Petrograd,  Russia,  United  States 
Branch,  Hartford,  Conn.,  Palace  of  Mines. — Photographs  of  com- 
pany's buildings  in  various  cities  of  the  world;  charts  showing 
progress  in  America  and  Russia;  samples  of  policies  used  abroad 
covering  all  branches  of  insurance;  literature  in  use  abroad. 

Miscellaneous 

Industrial  Accident  Insurance  Commission  of  the  State  of  CaU- 
fornia,  Palace  of  Mines. — Accident  conditions  in  California;  sta- 
tistics; photographs;  work  of  commission  to  prevent  industrial 
accidents  and  dseases. 

Workmen's  Compensation  Service  Bureau,  New  York,  Palace 
of  Mines. — ^Work  of  bureau  with  aims  and  objects;  methods  of 
scientific  rate  making  for  manufacturers;  drawings  and  charts, 
in  colors,  showing  measures  to  prevent  accident;  rest  room. 

Fraternal  Orders 

Independent  Order  of  Foresters,  Palace  of  Mines.— Models  of 
sanitariums  for  members;  literature  of  the  Order;  rest,  reading 
and  registration  room. 

Modern  Woodmen  of  America,  Rock  Island,  Palace  of  Mines. — 
Rest  and  reading  room;  literature. 

National  Union,  Toledo,  Ohio,  Palace  of  Mines.— Rest  room  for 
visitors  with  literature  of  the  Order. 

Boyal  Neighbors,  Women's  Auxiliary  of  Modem  Woodmen  of 
America,  Palace  of  Mines.— Rest  and  reading  room;  literature  of 
the  order. 

Rescue  Demonstrations 

Bureau  of  Mines,  Palace  of  Mines. — Mine  rescue  and  first  aid 
demonstration  at  2  p.m.  daily,  except  Sunday;  Exhibition  run 
of  mine  rescue  car  to  ' '  The  Mine. ' ' 

Coast  Guard  Service,  Fort  Point  Station,  Yacht  Harbor.— Daily 
exhibition  drill  by  coast  guard  crew  in  non-capsizable  boat ;  mimic 
wreck  with  breeches  buoy  rescue;  first  aid  demonstration. 

New  York  Fire  Department,  City  of  New  York  Building.— Mov- 
ing picture  films  every  day  at  four  o  'clock,  except  Sunday :  ' '  The 
Locked  Door,"  illustrating  fire  prevention,  and  "The  Fire  Fight- 
ers, ' '  showing  the  training  of  firemen ;  model  of  fireproof  theater. 


584  WORLD'S  INSURANCE  CONGRESS 

San  Francisco  Fire  Department,  Zone  Fire  Station. — Daily  ex- 
hibition of  rescue  work;  Pompier  drill  and  sealing  of  Exposition 
Fire  Plouse  and  Tower;  modern  fire-fighting  methods  and  training 
of  firemen. 

Industrlvls 

Aimconda  Copper  Mining  Company,  Butte,  ilont.,  Palace  of 
Mines. — Safety  first  work. 

Ford  Motor  Company,  Detroit,  IMieh.,  Palace  of  ]\Iines. — Photo- 
graphs and  models  illustrating  how  the  company  cares  for  the 
welfare  of  its  employees.  Factory  safeguards,  sanitary  methods 
and  medical  care. 

International  Harvester  Company  of  America,  Chicago,  111.,  Pal- 
ace of  Agriculture. — Regulation  and  inspection  of  factories  sta- 
tistics of  industrial  accidents  and  means  for  prevention ;  em- 
ployer 's  liability ;  welfare  work ;  social  insurance ;  retirement 
provisions  for  employees. 

National  Cash  Register  Company,  Dayton,  Ohio,  Palace  of  Lib- 
eral Arts. — Display  and  motion  pictures  accompanied  by  lecture 
on  sanitation  and  welfare  work  under  supervision  of  company. 

Southern  Pacific  Compa/ny,  Palace  of  Transportation. — Railway 
safety  devices  and  signals. 

United  States  Steel  Corporation  and  Subsidiary  Companies,  Pal- 
ace of  Mines. — Safety,  sanitation  and  welfare  work,  covering  fire 
and  accident  prevention ;  safety  organization  work  in  all  plants ; 
lectures  and  motion  pictures  every  afternoon  except  Sunday. 

Government  Exhibits 

Argentine  (Bepuhlic  of),  Palace  of  Education. — Fire  depart- 
ment statistics  of  Buenos  Aires,  lives  saved,  equipment  and  losses. 

Cuba  (EepuMic  of),  Government  Board  of  Health,  Palace  of 
Education. — Tropical  diseases  prevalent  and  how  they  are  con- 
trolled ;  carrying  propensities  of  the  mosquito  and  statistical 
charts  of  the  death  rates  from  the  more  common  diseases. 

Japan  (Bed  Cross  Society  of),  Palace  of  Education. — Red  Cross 
equipment. 

New  Zealand  {Government  of).  Palace  of  Agriculture. — Work- 
men's compensation  results  illustrated  by  charts  and  literature. 

Philippine  Islands  (Bureau  of  Health),  Palace  of  Education. — 
Problems  confronting  health  officials  at  the  time  of  American  occu- 
pancy and  metliods  adopted  for  the  betterment  of  the  living  condi- 
tions ;  sanitary  methods  and  results  in  the  prevention  of  diseases ; 
bearing  of  methods  on  death  rate. 

United  States  (Government  of).  Department  of  Labor,  Palace 
of  Education. — Industrial  diseases  and  accidents  portrayed  by 
charts,  figures,  transparencies  and  wax  figures ;  infant  mortality. 

United  States  (Government  of),  Forest  Service,  Palace  of  Agri- 
culture.— Educational    work    in    the    prevention    of    forest    fires; 


WORLD'S  INSURANCE  CONGRESS       585 

conditions  in  California  posted  dailj^  on  a  large  map  by  means  of 
colored  pins  showing  size  and  nature  of  fire. 

Health  and  State  Boards 

California  State  Board  of  Health,  Sacramento,  Cal.,  Palace  of 
Education. — Charts  of  statistics  and  photographs  showing  care 
and  danger  of  tuberculosis;  model  of  tuberculosis  sanatorium  and 
outdoor  sleeping  hammocks. 

Maryland  State  Board  of  Health,  Baltimore,  Md.,  Palace  of  Edu- 
cation.— Sanitation ;  Baltimore  high-pressure  water  system,  sewage 
disposal  system  and  social  welfare;  state  work  by  district  system. 

Massachusetts  Department  of  Health,  Palace  of  Education. — 
Quarantine  methods  and  work  done  to  eradicate  industrial  dis- 
eases; photographs  of  many  shops  that  have  installed  guards  and 
other  facilities  to  better  factory  conditions;  model  of  Massachu- 
setts Hospital  for  Crippled  and  Deformed  Children;  moving  pic- 
ture theater. 

New  York  Department  of  Labor,  Palace  of  Education. — ^Work 
accomplished  in  safeguarding  lives  and  health  of  workers ;  statis- 
tics. 

State  of  New  York,  Palace  of  Education. — Fire  protection,  life 
and  health  conservation. 

New  York  State  Department  of  Health,  Albany,  New  York,  Pal- 
ace of  Education. — Maps  and  charts  showing  experience  of  New 
York  board  and  the  methods  that  have  been  introduced  to  pre- 
vent disease;  death  rates  for  the  various  ages  bringing  out  the 
high  rate  between  the  time  of  birth   and  ten  years  of  age. 

Sanitary  Control,  Joint  Board  of,  New  York,  Palace  of  Educa- 
tion.— Work  accomplished  by  board  in  bettering  the  conditions  of 
workers  in  the  garment  trades  of  New  York  City;  display  by  the 
means  of  charts  and  photographs ;  fire  prevention  methods  and  in- 
spection system  of  factories. 

Pennsylvania  State  Board  of  Health,  Palace  of  Education. — 
Health  problems  of  State  shown  by  means  of  relief  maps  and 
charts  based  on  actual  experiences,  with  cause  and  remedy;  com- 
prehensive display  of  school  conditions  of  State  and  other  States; 
how  preventable  diseases  are  spread  and  how  they  can  be  minim- 
ized. 

Virginia  State  Board  of  Health,  Virginia  Building. — Screens 
showing  publicity  and  educational  activities,  giving  statistics  of 
preventable  diseases  and  the  deaths  from  such  diseases  of  both 
black  and  w^hite  population. 

Societies 

American  Medical  Association,  Philadelphia,  Palace  of  Educa- 
tion.— Patent  medicines  and  the  danger  from  their  use;   ingre- 


586  WORLD'S  INSURANCE  CONGRESS 

dients  and  records  showing  that  many  people  giving  testimonials 
die  of  the  disease  the  medicine  was  supposed  to  have  cured. 

American  Social  Hygiene  Association,  New  York,  Palace  of 
Education. — Social  hygiene. 

Arequipa  Sanitarium  of  Fairfax,  ^Marin  Co.,  California,  Pal- 
ace of  Education.— Sanitarium  for  tubercular  women,  exhibit 
showing  methods  of  treatment  and  the  making  of  pottery  by 
patients  which  is  part  of  the  treatment. 

Carnegie  Institute  of  Washington,  D.  C,  Palace  of  Education. 
— Scientific  research  ;  publications,  transparencies,  models,  photo- 
graphs and  diagrams  representing  work  in  nutrition  department 
and  nine  other  departments  of  research. 

Civic  Center  League,  Los  Angeles,  Cal.,  Palace  of  Education.— 
Unified  social  center  exhibit;  rural  social  center  with  genesis  of 
work  at  Rochester,  etc. 

Elizabeth  McCormick  Fund,  Chicago,  111.,  Palace  of  Educa- 
tion.— Models,  statistics,  charts  and  posters  showing  benefits  of 
outdoor  schools  for  normal  and  sub-normal  children ;  effect  on  the 
longevity  and  health  of  children. 

M&itth  Hygiene  Association  of  America,  Palace  of  Education. — 
Effect  of  neglect  of  the  teeth  demonstrated  and  preventive  methods 
which  should  be  in  force. 

National  Child  Labor  Committee,  New  York,  Palace  of  Educa- 
tion.—Display  to  educate  the  public  in  the  danger  to  the  coming 
generation  in  the  prevalence  of  employing  child  labor,  showing 
the  effect  on  the  future  health  and  gi^owth  of  the  child  and  the 
burden  on  the  rest  of  the  nation  when  these  children  grow  up, 
stunted  and  immature,  employed  at  small  wages. 

National  Consumers  League,  New  York,  Palace  of  Education.— 
Display  showing  the  danger  of  tenement  workers  and  comparison 
of  the  prices  paid  for  labor  and  the  cost  of  such  goods  to  the 
consumer;  photographs  and  charts  of  unsanitary^  tenement  work- 
shops and  effect  upon  health. 

Race  Betterment  Foundation  of  Battle  Creek,  Michigan,  Palace 
of  Education.— Methods  of  race  betterment  and  statistics  of  deaths 
from  preventable  diseases  and  drugs;  value  of  precaution  and 
thoughtfulness  by  the  individual  and  the  care  of  the  body ;  lectures 
by  Dr.  A.  J.  Read  three  times  a  week. 

Bed  Cross  of  the  United  States,  Palace  of  Liberal  Arts.— ^Models 
and  charts,  photographs,  statistics  showing  the  relief  work  done 
by  the  society;  first  aid  methods  and  equipment  for  war. 

Rockefeller  Foundatiou,  New  York,  Palace  of  Education.— 
Dangers  of  the  hookworm  and  work  of  the  Foundation  to  eradi- 
cate the  disease;  interesting  statistics  and  models  of  victims. 

San  Francisco  Society  for  the  Study  and  Prevention  of  Tuber- 
cidosis.  Palace  of  Education.— Charts  and  literature  on  tuberculo- 
sis; models  of  outdoor  sleeping  hammocks  and  sanatoria;  statistics 
of  death  rates;  X-Ray  plates  of  affected  lungs. 


WORLD'S  INSURANCE  CONGRESS       587 


Manufacturers  and  Exhibitors 

Aero  Auto  Fire  Alarm  Company,  Seattle,  Wash,,  Palace  of  Lib- 
eral Arts. — Auxiliary  fire  alarm  service  for  Panama-Pacific  In- 
ternational Exposition — Working  exhibit. 

American  Hoist  and  Derrick  Grip,  St.  Paul,  ]\Iinn.,  Palace  of 
Machinery. — Crosby  safety  grip  for  cables. 

American  Pulley  Company,  New  York,  Palace  of  Machinery. — 
Metal  Sash  pulleys. 

Golden  Anderson,  Palace  of  Machinery. — Automatic  steam  and 
water  valves. 

Baruch  Electric  Controller  Corporation,  San  Francisco,  Cal., 
Palace  of  Machinery. — Circuit  breakers  and  current  controllers. 

Bowers  Rubber  Works,  San  Francisco,  Palace  of  Manufactur- 
ers.— Fire  protection  hose. 

S.  F.  Browser  &  Co.,  Fort  Wayne,  Ind.,  Palace  of  Transpor- 
tation.— Safety  gasoline  pumps  and  systems. 

Crame  Company,  San  Francisco,  Cal.,  Palace  of  Machinery. — 
Water  and  steam  valves. 

General  Electric  Company,  Schenectady,  N.  Y.,  Palace  of  Trans- 
portation.— Electrical  appliances ;  air  brakes  ;  safety  devices.  Also 
safety  electric  mine  lamp,  United  States  Government  Exhibit, 
''The  Mine,"  Palace  of  Mines. 

Gold  Car  Heating  and  Lighting  Company,  New  York,  Palace  of 
Machinery. — Safety  car  lighting  and  heating  systems ;  safety  port- 
able heaters. 

Hauck  Manufacturing  Company,  Brooklyn,  N.  Y.,  Palace  of 
Machinery. — Safety  kerosene  torches. 

Herman  Safe  Company,  San  Francisco,  Cal.,  Palace  of  Manu- 
facturers.— Burglar  and  fireproof  vaults. 

Le  Blo7id  Machime  Tool  Company,  Cincinnati,  Ohio,  Palace 
of  Mines. — Cone  belt  shifter. 

Luckenheimer  Company  (The),  Cincinnati,  Ohio,  Palace  of  Ma- 
chinery.— Valves   and   engineering   appliances. 

National  Signal  Company,  San  Francisco,  Cal.,  Palace  of  Trans- 
portation.— Automatic  railway  crossing  signal  in  operation,  dis- 
played in  booth  of  Edison  Electric  Company. 

Nelson  Valve  Company,  Philadelphia,  Palace  of  ]\Iachinery. — 
Water  and  steam  valves. 

Neptune  Meter  Company,  New  York,  Palace  of  Machinery. — 
Water  and  fire  service  meters ;  trident  protection  water  meter  used 
by  Panama-Pacific  International  Exposition. 

New  York  Air  Brake  Company,  Palace  of  Transportation, — 
Working  air  brake  equipment  for  twelve-car  pa.ssenger  train. 

Ohio  Chemical  &  Manufacturing  Company,  Cleveland,  Ohio, 
Palace  of  Liberal  Arts. — Monovalve  anaesthetic  apparatus. 

Otis  Elevator  Company,  San  Francisco,  Cal.,  Palace  of  Machin- 
ery,— Elevator  equipped  with  safety  device. 


588  WORLD'S  INSURANCE  CONGRESS 

Permutit  Company  (The),  New  York,  Palace  of  Liberal  Arts. — 
Appliances  for  water  filtration  systems. 

Fittshurgh  Tank  Company,  Palace  of  Machinery. — Patented  roof 
tanks. 

Pyrene  Manufacturing  Company,  New  York,  Palace  of  Mav.-«<in- 
ery. — Construction  and  use  of  the  Pyrene  fire  extinguisher;  dem- 
onstrations given. 

Eailways  Specialties  Company,  Los  Angeles,  Cal.,  Palace  of 
Transportation. — Automatic  railway  crossing  signals  in  opera- 
tion, displayed  in  booth  of  Edison  Electric  Company. 

Randall  Elevator  Control,  San  Francisco,  Palace  of  Machinery. 
— Elevator  safety  device  preventing  movement  of  cage  until  door 
is  securely  closed. 

Rohhins  &  Myers  Company,  Springfield,  Ohio,  Palace  of  Machin- 
ery.— Safety  railway  signals ;  ventilators. 

Safety  Car  Heating  and  Lighting  Company,  New  York,  Palace 
of  Machinery. — Models  of  appliances. 

A.  P.  Smith  Manufacturing  Comipany,  East  Orange,  N.  J.,  Pal- 
ace of  Machinery. — Valves;  waterworks;  testing  materials. 

Standard  Underground  Cable  Company,  Palace  of  Machinery. — 
Underground  cables  and  conduits. 

Star  Electric  Comipany,  Newark,  N.  J.,  Palace  of  Liberal  Arts. — 
Central  fire  alarm  station  for  the  Panama-Pacific  International 
Exposition ;  working  exhibit   of  fire  alarms,  boxes,  etc. 

Technical  PuUishing  Company,  New  York,  Palace  of  IMachin- 
ery. — High-tcr.sion  wiring  showing  progress  by  comparison  of 
20,  15,  10  years  ago  and  to-day. 

Union  Sivitch  and  Signal  Company,  Swissdale,  Pa.,  Palace  of 
Transportation. — Automatic  block  signal  in  operation. 

West  Disinfecting  Company,  New  York,  Palace  of  Liberal  Arts. 
—Disinfectants;  model  of  indoor  sanitary  closet  for  district  hav- 
ing no  sewer  connections.  Working  exhibit,  supplying  accommo- 
dations on  Grounds. 

Western  Electric  Company,  Chicago,  Palace  of  ^Manufactures. 
— Fire  Alarm  apparatus;  gongs;  motors. 

Westinghouse  Electric  Comipany,  Pittsburgh,  Pa.,  Palace  of 
Machinery. — Safety  Air  brakes;  protected  motors  and  dynamos. 
Oil  circuit  breaker  to  handle  165,000  volts  in  Palace  of  Transpor- 
tation, 


COLLECTIVE    INSURANCE    AND    UNIVERSAL    SAFETY 

EXHIBIT 

Because  of  the  fact  that  the  Panama-Pacific  International  Ex- 
position had  given  such  wide  recognition  to  insurance  and  bad 
created  a  commission  to  promote  the  interests  of  the  business,  The 
Insurance  Field  Company  of  Louisville,  Ky.,  became  deeply  in- 


WORLD'S  INSURANCE  CONGRESS       589 

terested  in  the  whole  movement  and  after  a  careful  investigation 
determined  to  install  a  collective  insurance  exhibit — The  Collec- 
tive Insurance  and  Universal  Safety  Exhibit — to  visualize  the  serv- 
ice of  Insurance  and  in  conjunction  therewith  to  publish  a  daily- 
insurance  newspaper  in  San  Francisco,  The  Daily  Field,  wholly 
apart  from  its  regular  publications  in  Louisville. 

The  space  devoted  to  the  Collective  Insurance  and  Universal 
Safety  Exhibit  at  the  Exposition  was  not  secured  until  late  in 
January,  but  despite  this  fact  and  other  obstacles  to  be  overcome 
in  the  erection  of  the  booth  and  securing  exhibitors  and  partici- 
pants, the  whole  exhibit  was  in  creditable  working  order  within 
six  weeks,  with  a  total  of  115  participants.  The  space  occupied 
was  2,400  square  feet  in  Block  10,  Palace  of  Mines  and  Metallurgy, 
where  the  various  insurance  exhibits  were  located,  that  section 
being  a  part  of  the  Bureau  of  Education  and  Social  Economy, 
and  an  overflow  from  the  Palace  of  Education. 

The  booth  of  the  Collective  Insurance  and  Universal  Safety 
Exhibit  was  designed  to  entertain  and  provide  for  the  comfort  of 
policyholders,  agents  and  friends  of  participants — friends  of  In- 
surance— and  to  gain  new  friends.  It  was  constructed  in  a  sub- 
stantial way,  without  pretense,  but  to  carry  out  the  fundamentals 
of  Insurance  in  all  its  branches,  linked  by  the  great  chain  of  the 
social  service  performed  by  its  agents  in  the  field. 

Above  the  facade  of  one  of  the  three  main  entrances  appeared 
a  figure  "The  Spirit  of  Insurance"  overcoming  the  three  great 
dragons  of  Fire,  Accident  and  Death,  and  holding  aloft  the  green 
light  of  safety.  This  was  a  remarkable  piece  of  statuary  and  has 
been  greatly  admired.  Along  the  facade  were  silk  banners  indi- 
cating the  service  performed  by  Insurance. 

Within  the  exhibit  were  special  features,  such  as  a  panorama  of 
San  Francisco  as  it  appeared  nine  years  ago  after  the  greatest 
conflagration  in  the  history  of  the  world;  a  mechanical  device 
showing  the  great  Institution  of  Life  Insurance  drained  of  $24 
every  minute  of  every  day  and  night  as  a  tax  to  maintain  general 
State  revenues — $13,000,000  to  be  a  football  for  politicians  every 
year — and  a  mechanical  house  that  * '  burned ' '  every  three  minutes 
to  typify  one  of  the  160,000  buildings  burned  annually. 

Recognizing  the  immensity  of  the  task  undertaken,  The  Insur- 
ance Field  Company  secured  the  cooperation  of  The  Safety  Press, 
Incorporated,  of  New  York,  to  which  it  gave  the  title  of  manager 
of  the  ''Accident  and  Fire  Prevention  Department."  It  was 
through  the  efforts  of  The  Safety  Press  that  the  many  illuminat- 
ing displays  in  this  department  were  secured  and  exhibited  in  the 
booth  during  the  Exposition  period. 

To  conduct  the  Collective  Insurance  Universal  Safety  Exhibit 
and  publish  The  Daily  Field  in  San  Francisco,  The  Insurance 
Field  Company  brought  a  full  staff  from  the  East  which  was  un- 
der the  direct  charge  of  its  President. 

The  first  issue  of  The  Daily  Field  appeared  on  the  morning  of 


590  WORLD'S  INSURANCE  CONGRESS 

April  17,  It  was  "tabloid"  in  form  (the  size  of  an  ordinary  daily 
newspaper  once  folded)  and  appeared  every  morning  except  Sun- 
days, but  including  holidays,  until  October  18,  several  days  after 
the  close  of  the  World's  Insurance  Congress.  One  hundred  and  fifty- 
six  issues  of  this  publication  were  guaranteed,  but  there  were  in 
fact  one  hundred  and  fifty-eight  issues  of  the  paper,  which  ranged 
in  size  from  8  pages  minimum  to  28  pages  maximum  as  the  occa- 
sions and  events  demanded.  The  paper  was  published  on  perfect- 
ing presses,  was  illustrated  with  half  tones,  had  its  own  staff  pho- 
tographers and  in  every  way  was  conducted  upon  the  basis  of 
the  modern  daily  paper.     This  was  its  motto: 

"Insurance  which  is  Universal  Safety:  Conservator  of  Life, 
Labor  and  Property  and  the  Basis  of  National  Welfare." 

During  its  publication  period  The  Daily  Field  not  only  re- 
ported the  many  national  and  company  tonve;itio!is  held  in  and 
about  San  Francisco,  but  told  fully  every  event  held  at  the  Ex- 
position in  any  way  related  to  Insurance,  furthered  in  every  way 
the  Collective  Insurance  and  Universal  Safety  Exhibit  of  which 
it  was  a  part,  exploited  every  insurance  exhibit  at  the  Exposi- 
tion, published  both  local  and  Eastern  insurance  news  and  placed 
its  staff  at  all  times  at  the  service  of  Insurance  Men. 

During  the  sessions  of  the  World's  Insurance  Congress  The 
Daily  Field  maintained  minute  service  with  its  editorial  rooms 
where  within  five  minutes  after  an  event  or  announcement  in  the 
convention  hall  the  news  would  be  on  the  linotype  machine  and 
in  many  cases  before  the  day's  session  had  adjourned  the  news 
of  the  day  as  far  as  the  Congress  was  concerned  was  up  and 
ready  for  the  press.  The  papers  delivered  at  the  Congress  each 
day  were  published,  practically  in  full,  in  the  issue  of  the  next 
morning,  so  that  all  the  addresses  were  given  wide  publicity. 

Participants  in  the  Collective  Insurance  and  Universal  Safety 
Exhibit  were  as  follows: 

Associations  and  Clubs 

American  Museum  of  Safety,  New  York. — Miscellaneous  col- 
lections of  devices  assuring  the  safety  of  the  public,  with  particu- 
lar reference  to  the  prevention  of  accident  from  the  operation  of 
machinery;  fire  extinguishing  devices;  danger  signs,  etc. 

Live-a-Little-Longer  General  Committee,  Bach  ester.  N.  Y. — 
Wall  exhibit,  signs  and  charts  illustrating  welfare  work  and  sys- 
tem in  operation  in  various  schools. 

National  Association  of  Life  Underwriters,  New  York  City. — 
Electrically  operated,  mechanical  model  of  the  Institution  of  Life 
Insurance  being  drained  of  $24  every  minute,  day  and  night, 
through  taxation  of  life  insurance  premiums  for  the  benefit  of 
the  general  revenues  of  the  various  States,  and  at  the  expense  of 


WORLD'S  INSURANCE  CONGRESS       591 

the  thrifty  insured.  The  model  is  explained  by  signs  and  liter- 
ature on  taxation.  AVall  exhibit,  "Life  Insurance  as  a  Life  Vo- 
cation. ' ' 

NaUonal  Assocmtion  of  Insurance  Agents,  Boston,  Mass. — Orig- 
inal charter  signatures;  photographs  of  past  president;  aims  and 
objects;  declaration  of  principles. 

Panama-Pacific  Insurance  Club,  San  Francisco. — Rest  and  read- 
ing room;  general  headquarters  at  Exposition. 

World's  Insurance  Congress  Events,  San  Francisco. — Rest  and 
reading  room;  branch  headquarters  at  Exposition. 

Insurance  Companies 

Aetna  Insurance  Company,  Hartford,  Conn. 

Agricultural  Insurance  Company,  Watertown,  N.  Y. — Edward 
Brown  &  Sons,  general  agents,  San  Francisco. 

American  Automobile  Insurance  Compamj,  St.  Louis,  Mo. 

American  Bankers  Insurance  Company  (The),  Chicago,  III. 

American  Central  Life  Insurance  Company,  Indianapolis,  Ind. 

American  Credit  Indemnity  Company  of  New  York,  St.  Louis, 
Mo. — Sample  policy  credit  indemnity;  booklet  explaining  credit 
insurance. 

Atlantic  Life  Insurance  Company,  Richmond,  Va. 

American  Eagle  Fire  Insurance  Company,  New  York. 

Atlas  Assurance  Company,  Limited,  of  London,  New  York,  Chi- 
cago and  San  Francisco  departments. 

Bankers  Life  Company,  Des  Moines,  loica. — Sample  policy. 

British  America  Assurance  Company,  Toronto,  Canada. 

California  State  Life  Insurance  Company,  Sacramento,  Cal. 

Co^nmanwealth  Life  Insurance  Company,  Louisville,  Ky. 

Continental  Insurance   Company,  New  York. 

Commonwealth  Life  Insurance  Company,  Louisville,  Ky. 

Consolidated  Casualty  Company,  Louisville,  Ky. 

Continental  Casualty  Company,  Chicago,  III. — Special  wall  dis- 
play in  colors  showing  trade-mark  of  company. 

Delaware  Underwriters,  Philadelphia',  Pa. 

Equitahle  Life  Assurance  Society,  New  York. — "Wall  exhibit, 
consisting  of  framed  pictures  of  the  Equitable  Building,  Protec- 
tion of  Life  Insurance,  and  the  Beacon  Light. 

Farmers  National  Life  Insurance  Company,  Chicago,  III. — 
Sample  policy;  photograph  of  home  building. 

Fidelity-Phoenix  Fire  Insurance  Company,  New  York. 

First  National  Fire  Insurance  Company,  New  York. 

Georgia  Casualty  Company,  Macon,  Ga. — Miniature  bales  of  cot- 
ton ;  sample  policy. 

George  Washington  Life  Insurance  Company,  Charleston,  W. 
Va. — George  Washington  Calendar. 

Globe  <f:  Rutgers  Fire  Insurance  Company,  New  York. — Edward 
Brown  &  Sons,  general  agents,  San  Francisco. 


592  WORLD'S  INSURANCE  CONGRESS 

Great  Republic  Life  Insurance  Company,  Los  Angeles,  Cal. 

Great  Southern  Life  Insurance  Company,  Houston,  Texas. 

Great  Westerii  Accident  Insurance  Company,  Des  Moines,  Iowa. 

Guardian  Casucilty  &  Guaranty  Company,  Salt  Lake  City,  Utah. 

Hartford  Fire  Insurance  Company,  Hartford,  Conn. 

Home  Insurance  Company  (The),  New  York. — Framed  wall  dis- 
play of  original  autographic  signatures  of  those  to  whom  losses 
were  paid  in  the  San  Francisco  conflagration  of  1906;  wall  sign; 
automobile  log. 

Illinois  Life  Insurance  Company,  Chicago,  III. 

Independent  Life  Insurance  Company,  Nashville,  Tenn. 

Insurance  Company  of  the  State  of  Pennsylvania  (The),  Phila- 
delphia, Pa. — Wall  exhibit  of  bronze  plaque  showing  seal  of  com- 
pany ;  framed  facsimile  of  policy  issued  to  Stephen  Girard ; 
framed  exhibit  of  battleship  in  revolutionary  days,  model  in  com- 
pany's possession;  post  cards  of  Liberty  Bell,  William  Penn's 
home.   Barry  statue,   and  Independence  Hall. 

Interstate  Casualty  &  Guaranty  Insurance  Company,  Albu- 
querque, N.  M. 

Inter-Southern  Life  Insurance  Company,  L&uisville,  Ky. — Plas- 
ter model  to  scale,  electrically  lighted,  of  home  office  building. 

Jefferson  Standard  Life  Insurance  Connpany,  Greensboro,  N.  C. 
— Fly  exterminators;  sample  policy. 

Kentucky  Central  Life  &  Accident  Insurance  Company,  Louis- 
ville, Ky. 

Lincoln  Life  Insurance  Company,  Fort  Wayne,  Ind. 

Massachusetts  Accident  Company,  Boston,  Mass. — Framed  pho- 
tograph of  George  E.  McNeill,  founder,  who  established  George 
E.  McNeill  medals  for  bravery,  presented  annually  by  Interna- 
tional Association  of  Casualty  &  Surety  Underwriters;  sample 
policies. 

Massachusetts  Bonding  &  Insurance  Company,  Boston,  Mass. 

Masonic  Mutual  Life  Associatimt  (The)  of  the  District  of  Co- 
lumbia, Washington  (Legal  Reserve). 

Metropolitan  Life  Insurance  Company,  New  York. — Wall  dis- 
play. 

Mutual  Life  Insurance  Company  of  New  York. — Stereomotor- 
graph,  electrically  operated,  displaying  early  California  scenes 
and  mottoes  specially  applicable  to  life  insurance. 

National  Life  Insurance  Company  of  the  United  States  of 
America,  Chicago,  III. 

Newark  Fire  Insurance  Company,  Newark,  N.  J. 

New  York  Life  Insurance  Company,  New  York. — Literature  on 
taxation. 

Nord  Deutsche  Insurance  Company  of  Hamburg,  United  States 
Branch,  New  York. 

North  American  Accident  Insurance  Company,  Chicago,  III. — 
Framed  wall  display  in  colors. 

North    British   d;  Mercantile  Insurance   Company  of  England, 


WORLD'S  INSURANCE  CONGRESS  593 

United  States  Branch,  New  York. — Framed  wall  display,  consist- 
ing of  seal  of  company  in  colors. 

Ohio  Farmers  Insurance  Company,  Le  Roy,  Ohio. — Plaster 
model  of  trade-mark  of  "The  Farmer,"  as  framed  wall  exhibit, 
designed  and  executed  by  Usbourne. 

Old  Colony  Life  Insurance  Company,  Chicago,  III. 

Penn  Mutual  Life  Insurance  Company,  Philadelphia,  Pa. 

People's  National  Fire  Insurance  Company,  Philadelphia,  Pa. 

Phoenix  Assurance  Company  of  London,  United  States  Branch, 
New  York. 

Phoenix  Mutual  Life  Insurance  Company,  Hartford,  Conn. — 
Framed  photograph  of  home  office  building  as  wall  exhibit;  wall 
calendar;  sample  policies. 

Pittsburgh  Life  &  Trust  Company,  Pittsburgh,  Pa. 

Presbyterian  Minister's  Fund  for  Life  Insurance,  Philadel- 
phia, Pa. — Framed  wall  display,  consisting  of  facsimile  of  first 
policy  issued  in  1761. 

Provident  Life  &  Trust  Company,  Philadelphia,  Pa. 

Prudential  Insurance  Ccmipany  of  America,  Newark,  N.  J. — 
Wall  exhibit. 

Prussian  Life  Insurance  Company  of  Germany,  United  States 
Branch,  Hartford,  Conn. — Wall  charts  in  colors,  illustrating 
growth  of  life  insurance  throughout  the  world. 

Bepublic  Casualty  Company,  Cleveland,  Ohio. 

Reserve  Loan  Life  Insurance  Company,  Indianapolis,  Ind. 

Rossia  Insurance  Com,pany  of  Petrograd,  United  States  Branch, 
Hartford,  Conn. — Framed  photographs  showing  exterior  and  in- 
terior of  building  at  Hartford,  Conn. 

Royal  Insurance  Company,  Limited,  of  Liverpool,  England, 
United  States  Branch  Offices,  New  York,  Atlanta,  Chicago  and  San 
Francisco. — Framed  wall  exhibit,  trade-mark  of  company. 

Security  Life  Insurance  Company  of  America,  Chicago,  III. — 
Sample  policy. 

State  Life  Insurance  Company  (The),  Indianapolis,  Ind. 

Standard  Life  Insurance  (The)  of  Pittsburgh,  Pa. 

Sun  Insurance  Office  of  London,  Pacific  Coast  Branch,  San 
Francisco. — ^Willard  O.  Wayman  and  Carl  A.  Henry,  Joint  Gen- 
eral Agents.  House  plate  in  use  in  London,  Eng.,  about  1780, 
mounted  as  wall  exhibit  with  appropriate  description. 

Svea  Insurance  Company  of  Sweden,  Edward  Brown  &  Sons, 
general  agents,  San  Francisco. 

Transylvania  Casualty  Insurance  Company,  Louisville,  Ey., — ^by 
Ben  L.  Bruner,  President. 

Union  Central  Life  Insurance  Company,  Cincinnati,  Ohio. — 
Plaster  model  to  scale,  home  office  building,  electrically  lighted; 
postal  cards  of  building. 

West  Coast  San  Francisco  Life  Insurance  Company,  San  Fran- 
cisco, Cat. 


594 


WORLD'S  INSURANCE  CONGRESS 


Western  &  Southern  Life  Insurance  Company,  Cincinnati,  Ohio. 
Western  Assurance  Company,  Toronto,  Canada. 

General  Agents 

Brown,  Edward,  &  Sons,  Sa/n  Francisco,  Col. 

Nahors,  J.  B.  &  Sons,  San  Francisco  and  Los  Angeles,  Cat. 

Pandolfo,  8.  C,  San  Ajitonio,  Tex. 

Wayman,  W.  0.,  and  Henry,  Carl  A.,  San  Francisco. 


Manufacturers 

Allan  Manufacturing  Company,  Hartford,  Conn. — Safety  set 
screws. 

American  Abrasive  Metal  Company,  New  York. — Safety  treads 
for  stairs. 

Angell  Elevator  Lock  Company,  Boston. — Safety  stop  for  ele- 
vator and  mine  cages. 

Badger  Fire  Extinguisher  Company,  Boston. — Fifty  gallon 
chemical  engine. 

Carboy  Incinerator  Company,  New  York. — Device  attached  to 
carboys  eliminating  danger  to  operator  from  splashing  chemicals. 

Car7iegie  Steel  Company,  Pittsburgh,  Pa. — Safety  tool  heads. 

Draeger  Oxygen  Apparatus  C&mpany,  Pittsburgh,  Pa. — Appa- 
ratus complete  with  oxygen  generating  system;  asbestos  suit  used 
in  mine  rescue  work;  pulmotor. 

E.  I.  du  Pont  de  Nemours  Powder  Company,  Wilmington,  Del. 

Gorham  Engineering  &  Fire  Apparatus  Company,  San  Fran- 
cisco.— Pyrene  hand  fire  extinguishers;  smoke  helmet. 

Hammacher,  Schlemmer  &  Co.,  New  York. — Hollow  set  screws. 

Hess  Steel  Castings  Company,  Philadelphia. — Safety  hopper 
car  wrench. 

Johnson  &  Johnson,  New  Brunswick,  N.  J. — First  aid  cabinet. 

Lockhard-Hodge  Company,  Buffalo,  N.  Y. — Guards  for  circular 
saws,  planes  and  wood  shapers. 

Mann  &  Wilkomm,  Germany. — Model  of  elevator  with  safety 
stops. 

Morewood  Standard  Safety  Device  Company,  New  York. — 
Safety  belt  for  use  of  window  cleaners. 

Morrison  Safety  Ladder-Foot  Suction  Grip  Company,  Lowell, 
Mass. — Safety  ladder. 

National  Tube  Company,  Lorain,  Ohio. — Safety  hooks  and 
bucket  hoist;  safety  hood  for  feed  valves;  safety  sign  ''man  in 
boiler." 

Never  Slip  Safety  Clamp  Company,  New  York. — Horizontal  and 
vertical  safety  clamps  for  boiler  plate. 

New  Jersey  Zinc  Company,  Palmerton,  Pa. — Safety  wrenches 
for  hopper  cars;  safety  shield  for  spelter  ladle. 

New  York  Edison  Company,  New  York. — Ground  stick  to  test 


WORLD'S  INSURANCE  CONGRESS       595 

high  tension  feeder  before  joint  is  opened  for  repairs;  medical 
cabinet,  consisting  of  oxygen  tank,  reclining  chair,  blanket  and 
head  rest ;  first  aid  kit. 

Norton  Company,  Worcester,  Mass. — Emery  wheel  with  safety 
guard. 

Patent  Scaffoldmg  Company,  New  York. — Model  of  safety  scaf- 
fold. 

Pennsylvania  Wire  Glass  Company,  Philadelphia. — Section  of 
wire  glass  from  building  of  California  Electric  Works  that 
passed  through  conflagration  of  1906,  the  glass  being  the  recog- 
nized means  of  saving  the  property  from  destruction ;  samples  of 
wire  glass  signs  and  literature  explaining  protective  features. 

Sieher  Spraying  Nozzle  Company,  Kansas  City,  Mo. — Chemical 
spraying  nozzle  with  acid  proof  tank. 

Templeton-Eenley  Company,  Chicago. — Safety  jack. 

Willson  &  Willson,  Beading,  Pa. 

]\IlSCELLANEOUS 

Ben  P.  Branham  Printing  Company.  Chicago,  III. — Branham 
system  loose  leaf  form  books  for  local  fire  insurance  agents. 

Insurance  Educator  Company  (The),  Louisville,  Ky. — Books 
of  the  American  School  of  Insurance,  a  correspondence  course  in 
life  insurance  salesmanship;  file  of  The  Life  In,surance  Educator 
Monthly;  book  publications. 

Insurance  Field  Company  (The),  Incorporated,  Louisville,  Ky. 
— Multiplex  display  fixture  containing  samples  of  printing  and 
lithographing  for  insurance  companies  and  agents;  file  of  The  In- 
surance Field,  Casualty  &  Surety,  Fire  &  Marine,  and  Life  Edi- 
tions; book  publications. 

Safety  Press  (The),  Incorporated,  New  York. — Safety  litera- 
ture; file  of  Safety  Engineering;  book  publications. 

Sanborn  Map  Company,  San  Francisco  Branch  Office. — Under- 
writers' fire  map  of  the  Panama-Pacific  International  Exposition 
as  wall  exhibit. 


TRIBUTE  TO  ALVIN  E.  POPE 

Chief  of  Department  of  Education  and  Social  Economy  of  the 
Panama-Pacific  International  Exposition 

This  being  the  first  time  that  insurance  exhibits  had  been  classi- 
fied under  the  head  of  Social  Economy,  it  can  be  understood  that 
the  work  of  the  Chief  of  that  Department  was  somewhat  unusual, 
and  that  it  often  called  for  a  careful  study  of  various  angles  of 
the  insurance  business.  How  well  insurance  interests  were  satis- 
fied with  his  handling  of  the  subject  was  fully  attested  in  the 
proceedings  of  Life  Conservation  Day  of  the  World's  Insurance 


596  WORLD'S  INSURANCE  CONGRESS 

Congress,  when  Mr.  Alvin  E.  Pope,  chief  of  the  Department  of 
Education  and  Social  Economy  of  the  Panama-Pacific  Interna- 
tional Exposition,  was  presented  with  a  silver  loving  cup  by  the 
combined  insurance  underwriters,  bearing  the  following  inscrip- 
tion: 

Presented  to 

Alvin  Eugene  Pope 

Chief  of  Education  and  Social  Economy 

Panama-Pacific  International  Exposition 

October  12th,  1915 

By  Insurance  Exhibitors  and  Insurance  Men 

Generally 

In  Appreciation  of  His  Enlightened 

Administration  of 

Insurance 

Fittingly  classed  as  Social  Economy. 


IV.    CONSTITUTION  OF  THE  NATIONAL  INSURANCE 

COUNCIL 

Article  I 

NAME 

The  name  of  this  Association  shall  be  "National  Insurance 
Council." 

Article  II 

OBJECTS 

Its  purpose  shall  be  the  consideration  of  insurance  questions 
or  problems  common  to  insurance  interests  and  activities  related 
thereto. 

Article  III 

MEMBERSHIP 

1.  Membership  in  the  Council  shall  consist  of  national  organi- 
zations of  insurance  and  related  activities. 

2.  Admission  to  membership  shall  be  by  unanimous  vote  of  the 
Central  Committee,  or  by  the  votes  of  not  less  than  two-thirds  of 
the  membership  of  the   Council. 

3.  Each  association  or  organization  holding  membership  in  the 
Council  shall  be  represented  by  a  delegate  or  alternate  selected 
in  accordance  with  its  own  rules.  In  case  a  delegate  is  unable  to 
participate  in  a  meeting  of  the  Council,  his  alternate  shall  act  in 
his  stead. 

4.  A  member  may  withdraw  from  the  Council  at  any  time  by 
giving  notice  of  its  desire  in  writing. 

Article  IV 

ADMISSION   PEE   AND   DUES 

1.  A  fee  of  Twenty-five  Dollars  ($25.00)  shall  be  charged  for 
admission  to  membership  in  the  Council. 

2.  The  Central  Committee  shall  have  power  to  assess  members 
for  annual  dues  in  order  to  obtain  funds  needed  to  meet  the 
necessary  and  proper  expenses  of  the  Council,  but  such  assess- 
ment, including  the  admission  fee  in  each  case,  shall  not  exceed 
in  any  calendar  year  the  sum  of  Twenty-five  Dollars  ($25.00)  per 
member. 

Article  V 

MANAGEMENT 

1.  The  governing  body  of  the  Council  shall  consist  of  a  Central 
Committee  of  representatives  of  the  Fire,  the  Life,  the  Casualty 

597 


598       WORLD'S  INSURANCE  CONGRESS 

and  Surety,  the  ^Marine,  and  the  Fraternal  branches  of  insurance, 
but  not  to  exceed  three  of  each  class. 

2.  The  Central  Committee  shall  consist  of  the  persons  selected 
as  a  provisional  Central  Committee  by  the  World's  Insurance 
Congress,  October  9,  1915,  who  shall  serve  until  successors  are 
duly  selected  by  the  Council. 

3.  Vacancies  in  the  Committee  may  be  filled  by  the  Committee 
itself. 

4.  The  Central  Committee  shall  organize  for  work  under  such 
a  plan  as  to  it  may  seem  best,  but  all  services  to  be  rendered  by 
members  of  the  Committee  shall  be  without  compensation. 

5.  Officers  and  employees  of  the  Central  Committee  shall  serve 
during  its  pleasure  and  not  for  any  definite  term  unless  otherwise 
ordered  by  vote  of  the  Committee. 

6.  A  new  Central  Committee  shall  be  selected  by  the  Council 
at  each  regular  triennial  meeting  beginning  with  the  year  1918. 

7.  Any  class  of  insurance  organizations  enumerated  among  those 
entitled  to  representation  on  the  Central  Committee  shall,  on  re- 
quest of  two  or  more  members  of  that  class,  be  entitled  to  select 
its  representatives  on  such  Committee. 

8.  Under  authority  given  by  the  Executive  Committee  of  the 
World's  Insurance  Congress,  the  Central  Committee  shall  take 
entire  charge  of  editing,  publishing  and  distributing,  by  sale  or 
otherwise,  the  proceedings  of  the  Congress  and  other  insurance 
events  of  the  Panama-Pacific  International  Exposition. 

Article  VI 

MEETINGS 

1,  The  Council  shall  hold  a  general  meeting  at  least  once  in 
three  years.  Special  meetings  may  be  held  at  any  time  on  w-ritten 
request  of  a  majority  of  its  members  or  a  majority  of  the  Central 
Committee, 

2.  The  Central  Committee  shall  hold  a  general  meeting  at  least 
once  a  year.  Special  meetings  may  be  held  at  any  time  on  written 
request  of  not  less  than  five  of  its  members. 

Article  VII 

VOTING 

1.  All  voting  contemplated  under  various  provisions  of  this 
Constitution  may  be  done  by  mail  under  such  general  regulations 
as  may  be  provided  from  time  to  time  by  the  Central  Committee. 

Article  VIII 

AMENDMENTS 

1.  This  Constitution  may  be  amended  by  the  National  Council 
at  any  meeting  by  a  two-third's  vote,  if  included  among  those 
voting  for  the  amendment  is  at  least  one  representative  of  each 


WORLD'S  INSURANCE  CONGRESS       599 

class  of  the  insurance  organizations  represented  on  the  Central 
Committee. 

2.  Likewise  the  Constitution  may  be  amended  by  unanimous 
vote  at  any  meeting  of  the  Central  Committee  provided  among 
those  voting  for  the  amendment  is  at  least  one  representative  of 
each  class  of  the  insurance  organizations  represented  on  the  Cen- 
tral Committee. 

Article  IX 

QUORUM 

1.  A  quorum  for  the  transaction  of  business  by  the  National 
Council  and  likewise  of  the  Central  Committee  shall  consist  of 
not  less  than  five  members,  included  among  which  must  be  at 
least  one  representative  of  each  class  of  the  insurance  organizations 
represented  on  the  Central  Committee. 

Article  X 

PROXIES 

1.  Delegates  and  representatives  on  the  Central  Committee  shall 
have  power  to  name  proxies  to  act  in  their  stead  in  case  of  their 
inability  to  attend  any  meeting. 


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